According to an industry body, food prices in the UK have experienced their first decrease in over two years, attributed to intense competition among retailers.
In September, the British Retail Consortium (BRC) reported a 0.1% decrease in the cost of an average food basket compared to the previous month. This marks the first monthly decline since July 2021.
The group also noted that food inflation continued to slow down for the fifth consecutive month, registering an annual rate of 9.9% in September, which marked a decrease from 11.5% in August.
The BRC noted that the decrease in average food prices last month contributed to a reduction in overall shop price inflation, which dropped to 6.2% in September from 6.9% the previous month. This marked the lowest annual rate since September 2022.
Helen Dickinson, chief executive of the BRC, said, “This [competition between retailers] brought year-on-year food inflation down to single digits and contributed to the fifth consecutive monthly fall in the headline rate, helped by easing cost pressures.
“Customers who bought dairy, margarine, fish and vegetables – all typically own-brand lines – will have found lower prices compared to last month.”
Dickinson further mentioned that it was anticipated for price increases to continue decelerating throughout the remainder of the year.
“However, there are still many risks to this trend – high interest rates, climbing oil prices, global shortages of sugar, as well as the supply chain disruption from the war in Ukraine,” she added.
“Retailers will continue to do all they can to support their customers and bring prices down, especially as households face being squeezed by higher energy and mortgage bills.”
In the previous month, the Office for National Statistics (ONS) of the UK government reported that the inflation rate for food and non-alcoholic beverage prices decreased to a 13.6% annualized increase in August, down from 14.9% in July.
The general inflation rate also experienced a decline, dropping to 6.7% from 6.8% in July, a shift attributed to the deceleration in food price increases.