Finance
UK shop prices rise at fastest pace in nearly two years
Published by Global Banking and Finance Review
Posted on January 27, 2026
2 min readLast updated: January 27, 2026
Quick Summary
UK shop prices have surged at their fastest rate in nearly two years, driven by increases in food and non-food items, according to the British Retail Consortium.
UK shop prices rise at fastest pace in nearly two years
Overview of Retail Price Increases
LONDON, Jan 27 (Reuters) - Prices at major British retailers rose at the fastest pace since February 2024 this month, led by a pick-up in prices for food as well as furniture and health and beauty products, industry figures showed on Tuesday.
The British Retail Consortium's shop price index showed a 1.5% annual rise in January, up from a 0.7% gain in December.
Food prices were 3.9% higher than a year earlier, up from a 3.3% rise in December and the biggest increase since October.
Food Price Increases
"Any suggestion that inflation has peaked is simply not borne out by these figures," BRC Chief Executive Helen Dickinson said.
Non-Food Price Trends
"Shop price inflation jumped this month due to high business energy costs and the hike to National Insurance continuing to feed through to prices. Meat, fish and fruit were particularly affected," she added.
Non-food prices rose by 0.3%, also the biggest annual rise since February 2024.
* Official consumer price inflation data for December -which covers a wider range of goods and services - rose to 3.4%from 3.2% * Bank of England Governor Andrew Bailey expects CPI to fallclose to 2% by April or May, largely due to different one-offprice changes in regulated prices and taxes this year comparedto 2025 * CPI data showed food and non-alcoholic drink prices rose4.5% year-on-year, less than the 5.3% forecast by the BoE inNovember * April 2025 brought a 25 billion-pound ($34 billion)increase in employers' National Insurance payments, whichaffected most heavily sectors such as retail with morelower-paid, part-time staff * The BRC data is based on prices from January 1-7($1 = 0.7314 pounds)
(Reporting by David MillikenEditing by William Schomberg)
Key Takeaways
- •UK shop prices rose at the fastest pace since February 2024.
- •Food prices increased by 3.9% year-on-year.
- •Non-food prices saw a 0.3% rise, the highest since February 2024.
- •High business energy costs contribute to price inflation.
- •The Bank of England anticipates a CPI decrease by mid-year.
Frequently Asked Questions about UK shop prices rise at fastest pace in nearly two years
1What is inflation?
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power.
2What is consumer price inflation?
Consumer price inflation measures the average change over time in the prices paid by consumers for a basket of goods and services.
3What are retail prices?
Retail prices are the prices at which goods and services are sold to consumers in stores or online.
4What is the British Retail Consortium?
The British Retail Consortium (BRC) is a trade association representing the retail industry in the UK, providing insights and data on retail performance.
5What is the shop price index?
The shop price index is a measure that tracks the price changes of a representative basket of goods sold in retail stores.
