Shop price inflation hits record highs across all categories

Shop price inflation surged to 8% in the first week of January, up from 7.3% in December, surpassing the three-month average rate of 7.5%.

Food price inflation reached the “highest rate in the food category on record”, increasing to 13.8% in the week to January 7, up from 13.3% the previous month. This also exceeded the three-month average rate of 13.2%.

Fresh food inflation rose to 15.7%, up from 15% in December, while ambient food inflation reached 11.3% during the period, up from 11% previously.

Non-food inflation also jumped to a record high reaching 5.1% during the period, a 4.4% increase from December.

BRC chief executive Helen Dickinson said: “Retail prices rose in January as discounting slowed and retailers continued to face high input costs.

“Ambient food inflation accelerated the most as wholesale and bulk prices grew, particularly for sugar and alcohol. Fresh food prices also remained high due to increased food production costs as well as elevated wholesale fruit and vegetable prices. 

“Meanwhile, clothing and footwear prices eased, so customers were able to replenish their wardrobes with some bargains during the January sales.

“With global food costs coming down from their 2022 high and the cost of oil falling, we expect to see some inflationary pressures easing.

“However, as retailers still face ongoing headwinds from rising energy bills and labour shortages, prices are yet to peak and will likely remain high in the near term as a result.”