Posted By Global Banking and Finance Review
Posted on February 4, 2025
LONDON (Reuters) -British consumers received some relief to pressure on their budgets in January as a step-up in supermarket promotions meant grocery inflation edged lower following four straight months of rises, industry data showed on Tuesday.
Market researcher Kantar said annual grocery price inflation was 3.3% in the four weeks to Jan. 26, down from 3.7% in last month's report. Sales rose 4.3% over the period year-on-year.
It said the fall in inflation reflected an increased level of January promotions from supermarkets. They rose year-on-year by 274 million pounds ($340 million), accounting for 27.2% of sales – the highest level in January since 2021.
Kantar said prices are rising fastest in products such as chocolate confectionery, chilled smoothies and juices and butters and spreads, and are falling fastest in cooking sauces, household paper products and cat food.
Despite the January fall in food inflation, supermarkets have warned that tax rises in the new Labour government's first budget in October, together with another rise in the national minimum wage, will be inflationary.
Prominent grocery industry researcher, the Institute of Grocery Distribution has forecast that food inflation could hit nearly 4.9% in 2025.
($1 = 0.8057 pounds)
(Reporting by James Davey, Editing by Paul Sandle)
