Checkout cheer as shop inflation hits 2-year low

SHOP price inflation eased to its lowest rate since December 2021 – driven by falling food costs and competition between retailers, data shows.

The figure in March was 1.3% higher than a year ago, slowing from February’s 2.5% and well below the three-month average of 2.2%, according to the British Retail Consortium (BRC)NielsenIQ Shop Price Index.

Food prices overall are 3.7% higher than a year ago, down from 5% in February. But it is the 10th consecutive month of slowing inflation for the category and its lowest since April 2022.

Fresh food inflation slowed further to 2.6% from 3.4% a month earlier.

Inflation on products other than food fell to 0.2% in March, down from 1.3% in February, and its lowest since January 2022.

BRC chief executive Helen Dickinson, right, said: “While Easter treats were more expensive than in previous years due to high global cocoa and sugar prices, retailers provided cracking deals

Aisle good...price rises are now slowing down on popular chocolates, which led to price falls compared to the previous month. Dairy prices also fell as farmgate prices eased and retailers worked hard to lower prices for many essentials. “In non-food, prices of electricals, clothing and footwear fell as retailers increased promotions to entice consumer spending.”

Mike Watkins, head of retailer and business insight at NielsenIQ, said: “The slowdown in inflation continues and a key driver this month was a further fall in food prices.

“A year ago, food inflation was 15% so this was to be expected – but it is also helped by intense competition among the supermarkets as they look to drive footfall, with focused price cuts and promotional offers for Mother’s Day and now again in the weeks leading up to Easter.”

The inflation figures mean groceries are not necessarily cheaper but prices are going up less steeply.