Shop Price Inflation Slows in UK

UK shop price inflation eased to 1.4% year-on-year in September from 1.5% in August, beating market expectations of 1.5%. The figure remains above the three-month average of 1.3%, according to data released by TradingView.

The slowdown was driven by a decrease in food price inflation to 2.5% from 2.8%, as promotions lowered meat and dairy prices. However, poor European harvests pushed up fruit prices, while high commodity costs kept chocolate and confectionery prices elevated.

Non-food inflation also eased to 0.8% from 0.9%, thanks to strong discounting that reduced the cost of back-to-school essentials. Despite this, retailers are still grappling with higher business rates, employment costs, energy bills, and packaging taxes.

The British Retail Consortium warned that there is a limit to how much additional costs businesses can shoulder, suggesting that prices may rise further if these pressures persist.