Price rises in UK shops slowed to 6.9% in August, from 7.6% in July, according to new figures from the British Retail Consortium (BRC).
The easing of shop price inflation to the lowest level since October 2022 was driven by a deceleration in food price inflation, although food prices are still much higher than they were a year ago.
Food inflation in August dropped to 11.5%, compared with 13.4% in July, while non-food inflation remained unchanged at 4.7%.
Meat, potatoes and some cooking oils are among the products that have risen in price less sharply. However, the BRC warned of “supply chain risks” on the horizon.
“Russia’s withdrawal from the Black Sea Grain Initiative and its targeting of Ukrainian grain facilities, as well as poor harvests across Europe and beyond, could serve as potential roadblocks to lower inflation,” said BRC chief executive Helen Dickinson.
“A potential £400m hike to business rates bills from next April would certainly jeopardise efforts to tackle inflation unless the Chancellor intervenes.”
Mike Watkins, head of Retailer and Business Insight at NielsenIQ, added: “Looking ahead, a NIQ survey shows that 60% of households expect to be severely or moderately impacted by rising household costs in the coming months so once back from summer holidays, we expect consumers to remain cautious about discretionary spend even as inflation decelerates.”
