Shop prices have soared across all the metrics with inflation hitting the highest point in 14 years, with consumers facing the biggest cut in income since the 1970s.
According to the latest BRC-NielsenIQ Shop Price Index data, shop price annual inflation accelerated to 3.1% in June, up from 2.8% in May – above both the six and 12-month average increases and its highest point since September 2008.
Food inflation surged 5.6% in June, up from 4.3% in May – the highest rate since June 2011.
Non-food inflation decelerated 1.9%, having jumped 2% in May. Despite the fall, non-food inflation remains close to the highest it has been since the shop price index began.
Fresh food inflation was up 6.2%, while ambient food inflation accelerated to 4.8% in June.
BRC chief executive Helen Dickinson warned that retailers that consumers are facing the biggest real cut in terms of their income since the 1970s.
“Last month households and businesses were hit by the highest rate of inflation since the 1980s as near-record commodity prices in energy, transport and food filtered through the supply chain. Food prices rose sharply, particularly for fresh foods such as cheese, which has been affected by the spiraling costs of fertiliser and animal feed.
“As households face the biggest real terms cut in income since at least the 1970s, and businesses grapple with upstream supply chain costs, retailers remain focused on protecting their customers. Fierce competition means that retailers will continue to absorb as much of these costs pressures as possible and look for efficiencies in their businesses.
“Supermarkets are also expanding their value ranges to offer a wider choice for customers trading down and providing discounts to vulnerable groups. Retailers are working to find more ways to protect their customers from the worst effects of inflation, but if costs continue to spiral, Government may need to find ways to help retail businesses support their customers.”
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