The British Retail Consortium (BRC) has warned that shop price inflation is at risk of accelerating again this year due to retailers facing a wave of higher costs.
Latest data from the BRC-NielsenIQ Shop Price Index shows annual inflation in the sector was unchanged at 4.3% in December. This is below the three-month average rate of 4.6% and its lowest level since June 2022.
Food inflation saw its eighth consecutive deceleration, down from 7.7% in November to 6.7% last month. Fresh food inflation slowed from 6.7% to 5.4%, while ambient food decelerated from 9.2% to 8.4%.
However, non-food inflation rose to 3.1% in December, up from 2.5% in November, following retailers’ investment in Black Friday discounting and ahead of the January sales.
Helen Dickinson, Chief Executive of the BRC, suggested that the overall downward trend was at risk of reversing, warning that “obstacles on the road” threatened to stoke price inflation again this year.
She noted that retailers would continue to do “all they can to keep prices down in 2024” but said they were facing pressures from new border checks for EU imports and hundreds of millions more on business rates bills in April.
Dickinson concluded: “Government should think twice before imposing new costs on retail businesses that would not only hold back vital investment in local communities but also push up prices for struggling households.”
