Food price rises may have finally peaked in glimmer of hope for shoppers
Food inflation slowed this month after an all-time high in April, offering a glimmer of hope to struggling shoppers.
The price of groceries went up by 15.4% in the year to May, down from 15.7% in April.
The fall has been driven by supermarkets lowering prices to compete after a drop in energy and commodity costs.
But while May’s figure provides some good news, it is still the second fastest annual increase ever measured.
Ambient food inflation – or stable items that can be stored at room temperature – rose from 12.9% in April to 13.1% in May, according to the British Retail Consortium and NielsenIQ.
Shop prices 'are yet to peak and will remain high' as inflation hits new heights
The BRC index is not the only measure of inflation followed by retail analysts.
Kantar figures show food price inflation remained at its third-highest level since the financial crisis, dropping marginally to 17.2% during the four weeks to May 14.
According to the Office for National Statistics - which produces the main headline Consumer Price Index (CPI) measure of inflation - grocery inflation stood at 19.1% in April.
Prime Minister Rishi Sunak is believed to be considering a plan for supermarkets to place a cap on the price of basic items such as bread and milk.
But the BRC said the measures would not help and could curb efforts to cut inflation.
BRC chief executive Helen Dickinson said: "While overall shop price inflation rose slightly in May, households will welcome food inflation beginning to fall.
"The slow in inflation was largely driven by lower energy and commodity costs starting to filter through to lower prices of some staples including butter, milk, fruit and fish.
"Conversely, the price of chocolate and coffee rose off the back of the ongoing high global costs for these commodities. While non-food inflation rose, consumers are benefiting from heavy discounts in footwear as well as books and home entertainment.
"Fierce competition between supermarkets has helped keep British food among the cheapest of the large European economies.
"While there is reason to believe that food inflation might be peaking, it is vital that Government does not hamper this early progress by piling more costs onto retailers and forcing up the cost of goods even further.
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"The biggest risk comes from policies such as the incoming border checks and reforms to packaging recycling fees."
Mike Watkins, head of retailer and business insight at NielsenIQ, said: "To help mitigate the impact of inflation, shoppers are saving money by looking for seasonal promotions on the high street and taking advantage of the price reductions offered by supermarket loyalty schemes.
"Food retailing in particular is competitive, so hopefully the recent price cuts in fresh foods is a sign that inflation has now peaked, albeit ambient inflation may take a little while longer to slow."
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