Grocery price inflation falls but shoppers still forking out for essentials, figures show

Grocery price inflation slowed down at the second fastest rate since records began over the past month but shoppers still face higher prices across “every supermarket shelf”, figures show.

Analysts at Kantar reported price inflation across grocery shops at 12.7% for the four weeks to August 6, dropping from 14.9% over the previous month.

It is the fifth consecutive decline in the rate of price rises since the figure peaked at 17.5% in March.

The latest drop comes as supermarkets have pulled down the price of some staples, such as milk, since earlier in the year.

Fraser McKevitt, head of retail and consumer insight at Kantar, said: “The latest slowdown in price rises is the second sharpest monthly fall since we started monitoring grocery inflation in this way back in 2008.

“Prices are still up year-on-year across every supermarket shelf, but consumers will have been relieved to see the cost of some staple goods starting to edge down compared with earlier in 2023.

“Shoppers paid £1.50 for four pints of milk last month, down from £1.69 in March, while the average cost of a litre of sunflower oil is now £2.19, 22p less than in the spring.”

The data, based on the shopping habits of 30,000 households across the UK, also showed strong demand for own-label products from cash-conscious customers, with sales up by 9.7% for the quarter.

Overall take-home grocery sales increased by 6.5% over the month, Kantar said, slipping from 10.4% growth last month.

The experts said recent wet weather saw shoppers turn away from traditional summer favourites, while soup sales grew 16% as people looked for warming meals.

Mr McKevitt added: “It was a better month for Barbie than barbecues this July as the rain put a spanner in the works for many consumers’ outdoor plans – a stark comparison to last year when we experienced the hottest day on record.

“Volume sales of ice creams were down by 30%, while soft drinks sales were nearly a fifth lower than 12 months ago.”

The fresh data also shows that sales at Tesco and Sainsbury’s grew strongly over the month, rising by 9.5% and 9.3% respectively.

Meanwhile, Aldi was the fastest growing retailer for the fourth month in a row, with its sales jumping by over a fifth year-on-year.