News
31 May 2023

High food inflation damaging to consumer confidence - retail body

bira-andrew-goodacre(903287)

The British Independent Retailers Association says it is struggling to understand why non-food inflation is so low compared to food inflation, following the release of a new report from the BRC-Nielsen Shop Price Index.

Speaking about the report, which can be downloaded here, BIRA, which works with over 6,000 independent businesses of all sizes across the UK, said that inflation was proving to be very 'stubborn'.

The report shows shop Price annual inflation accelerated to 9.0 per cent in May, up slightly from 8.8 per cent in April.

This is above the three-month average rate of 8.9 per cent. This brings shop price growth to a fresh high.

Also reported:

  • Non-Food inflation accelerated to 5.8 per cent in May, up from 5.5 per cent in April. This is above the three-month average rate of 5.7 per cent.
  • Food inflation decelerated to 15.4 per cent in May, down from 15.7 per cent in April. This is the same as the three-month average rate of 15.4 per cent, and is the second highest inflation rate in the food category on record.
  • Fresh Food inflation decelerated in May, to 17.2 per cent, down from 17.8 per cent in April. This is below the three-month average rate of 17.3 per cent and is the second highest inflation rate in the fresh food category on record.
  • Ambient Food inflation accelerated to 13.1 per cent in May, up from 12.9 per cent in April. This is above the three-month average rate of 12.8 per cent and is the fastest rate of increase in the ambient food category on record.

Andrew Goodacre (pictured), BIRA CEO, said: "Inflation is proving to be very stubborn and clearly not falling as quickly as expected.

“I still find it hard to understand why non-food inflation is so low compared to food inflation, even though the non-food retailers and suppliers are facing the same cost pressures, and arguably higher in some cases.

"High food inflation is very damaging to consumer confidence as it makes people make less discretionary expenditure on non-food items.

“Talk of capping prices is interesting but not really addressing the issue of high overheads such as energy costs which are not reducing for businesses as quickly as they should.

“Government focus must be on reducing the overheads for businesses which in turn will result in lower prices."

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