The figures show non-food inflation, which includes clothing, was -0.8% year-on-year in August, which was a slight increase from July’s -1.0% decline. This rate surpasses the three-month average of -1.0%.
This marginal rise contrasts with the broader trend of shop price inflation, which accelerated to 0.9% year-on-year in August from 0.7% in July, outpacing the three-month average of 0.6%.
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The increase in shop price inflation is due to several reasons, such as “heightened global supply costs and seasonal food inflation,” which are further impacted by the weather, according to Mike Watkins, head of NIQ Retailer and Business Insight.
The cessation of promotional activities associated with recent sporting events and an escalation in underlying operational expenses also contributed to this trend.
BRC chief executive Helen Dickinson said: “Shop price inflation hit its highest rate since March last year, fuelled by food price rises. This adds pressure to families already grappling with the cost of living. Staples such as butter and eggs saw significant increases due to high demand, tightening supply, and increased labour costs. There was some respite for parents ahead of the new academic year, with lower prices for clothing, books, stationery, and computing.”
Food inflation specifically jumped to 4.2% year-on-year in August, edging up from 4.0% in July and surpassing the three-month average of 3.9%.
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By GlobalDataDickinson also cited the Bank of England’s acknowledgement that the “£7bn ($9.43bn) in new costs flowing through from last year’s budget has created an uphill battle for retailers”.
“The planned business rates reforms present an opportunity to deliver a meaningful reduction in retail, hospitality and leisure bills, ensure no shop pays more as a result and help retailers keep prices low for customers,” Dickinson added.
