A chief executive has warned that while shop prices are reaching record highs after soaring inflation in January, the peak is yet to be seen.
Compared to last January, overall food inflation has risen by 13.8 per cent from 13.3 per cent in December - the highest inflation rate on record. Meanwhile, inflation on fresh food also reached a record high due to increased food production costs alongside accelerated rates for fruit and vegetable prices at 15.7 per cent from 15 per cent in December.
Ambient food inflation for products such as sugar and alcohols also accelerated to 11.3 per cent from 11 per cent in December. However, clothing and footwear prices eased which has allowed for consumers to fill up their wardrobes with January sales.
Read more: Aldi shoppers can get huge £10 bag of food for £3.30 as part of new scheme in every store
BRC chief executive Helen Dickinson said: “Retail prices rose in January as discounting slowed and retailers continued to face high input costs. 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.”
Mike Watkins, head of retailer and business insight at NielsenIQ, said: “Consumer demand is likely to be weak in the first quarter due to the impact of energy price increases and, for many, Christmas spending bills starting to arrive. So the increase in food inflation is going to put further pressure on household budgets and it’s unlikely that there will be any improvement in the consumer mindset around personal finances in the near term.
“With shoppers having less money to spend on discretionary retail having paid for their essential groceries, there will be little to stimulate demand across the non-food channels.”
Read next:
Selena Gomez's budget skincare saviour for removing mascara that's under £4
Beauty fans ‘need’ £10 Bobbi Brown primer dupe that rivals Aldi and Primark
Boots shoppers bagging £25 eye cream that ‘instantly erases’ dark circles for £9
- Boots shoppers ‘in love’ with ‘amazing’ £12 mascara that rivals Benefit and Mac
Marks and Spencer giving away £60 worth of products to anyone who spends £25
