Annual price inflation reached its highest level since June 2014 last month, despite falling prices for clothing and footwear, driven by rising food prices.
The Office for National Statistics (ONS) found that inflation reached 1.8% in the year to January, up from a rise of 1.6% in December and marking the fourth consecutive month of rising prices.
The increase was driven by mounting fuel prices and, to a lesser extent, food prices, which were unchanged between December and January, having fallen the previous year.
These increases were partially offset by falling clothing and footwear prices, which fell 4.2% between December and January, compared to a 3.1% decrease the previous year.
Furniture and household goods also recorded a nominal decrease year-on-year.
While inflation hit a two-and-a-half-year high last month, the GfK’s Inflation Watch found that 74% of UK shoppers believe prices have been rising over the last 12 months, up from 52% of shoppers last year.
Nearly three out of four shoppers (74%) also believe that prices would continue to climb in the coming year, compared to 55% of consumers surveyed the previous year.
GfK’s head of market dynamics Joe Staton said: “The fall in the value of the Pound since the Brexit vote has fuelled speculation among both business leaders and consumers alike that we will see accelerated price inflation filter through to the high street this year.
“A third of UK shoppers anticipate rapid rises across a wider range of goods will impact spending, making us all even savvier in comparing prices for everyday purchase decisions.
“This is good news for brands that represent value-for-money in consumers’ hearts, wallets and minds, but does it mean tough times ahead for everyone else?”