Prices are experiencing the highest rate of inflation in more than a decade, according to the BRC-NielsenIQ Shop Price Index. The shop price annual inflation accelerated to 2.7% in April, up 2.1% in March, the highest jump since September 2011. It is significantly above the 12- and six-month average price increases of 0.4% and 1.5%, respectively.
Non-food suffered the biggest blow, with the highest rate of inflation since the data series began in 2006. Inflation in this category accelerated to 2.2% in April, up from 1.5% in March. This is above the 12- and six-month average price decrease of 0.1% and increase of 0.9%, respectively.
Fresh Food inflation, on the other hand, decelerated in April to 3.4%, down from 3.5% in March – the second highest inflation rate since March 2013.
Helen Dickinson OBE, chief executive of the British Retail Consortium, says: “The impact of rising energy prices and the conflict in Ukraine continued to feed through into April’s retail prices. Non-food products, particularly furniture, electricals and books, have seen the highest rate of inflation since records began. This has been exacerbated by disruption at the world’s largest seaport, following Shanghai’s recent lockdown. Food prices continued to rise, though fresh food inflation slowed as fierce competition between supermarkets resisted price hikes on many everyday essentials.
“Global food prices have reached record highs, seeing a 13% rise on last month alone, and even higher for cooking oils and cereals. As these costs filter through the supply chain, they will place further upward pressure on UK food prices in the coming months. Retailers will continue to do all they can to keep prices down and deliver value for their customers by limiting price rises and expanding their value ranges, but this will put pressure on them to find cost-savings elsewhere. Unfortunately, customers should brace themselves for further price rises and a bumpy road ahead.”
Mike Watkins, head of retailer and business insight, NielsenIQ, says: “Inflation shows no signs of abating and the increase in non-food prices is an extra challenge for the high street as fragile consumer confidence and rising living costs are likely to negatively affect consumer spending. With food retailing no longer immune to these pressures, supermarkets are reacting by cutting the prices of some everyday grocery products including private label to help limit shop price inflation.”
