The August Shop Price Index increase is the highest it has been since May 2004, when the figure stood at 1.53 per cent.
Following a 0.7 per cent fall in July, prices in August showed a month-on-month increase of 0.25 per cent, the third month-on-month rise this year.
Prices of non-food items were up 0.14 per cent against July while, for food, there was a 0.48 per cent jump against last month. Food prices have increased in six of the past eight months.
BRC director-general Kevin Hawkins said: 'The August figure comes as no surprise, as food prices are being driven by seasonal factors, which this year have been amplified by lower than average crop yields, due to a long hot summer.'
The clothing price index increased to 94.54, after falling to its lowest level so far this year, of 93.95 in July. The rise, however, is still lower than any month recorded prior to July this year.
After falling to its lowest level in July so far this year, the furniture index increased by 1.45 per cent to reach 95.88.