Inflation in British food retail at lowest level in almost three years

According to data from market research firm Kantar, food inflation has fallen to its lowest level since September 2021.

Due to falling inflation, sales of branded products rose 3.6 percent, outperforming grocery stores' own-brand products, which rose 2.7 percent.

This decline coincided with a sharp increase in monthly footfall this year, with UK shoppers making 2% more trips to the supermarket during this period than a year ago.

During England's tour of the European Championships, beer sales by football fans increased by an average of 13% on the days the team played compared to the same day the previous week.

Promotions by supermarkets to attract football fans during the 2024 European Championships led to increased competition between chains in areas such as beer and snacks.

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However, since many games were played on “school nights,” the British apparently opted for moderation: spending on non-alcoholic and low-alcohol beer on match days increased by 38%.

Fraser McKevitt, head of retail and consumer intelligence at Kantar, said: “England's hopes may have been dashed on Sunday, but there was still cause for celebration in the grocery sector.”

“Sales of chips and snacks also increased, rising by 5 percent compared to the previous month.”

Prices rose in markets such as vitamins/minerals/nutritional supplements and chilled fruit juices, while prices fell the most in the toilet paper, butter and dog food categories.

In retail, Tesco (TSCO.L) recorded its biggest market share gain in almost three years and extended its lead as the UK's largest supermarket, according to industry figures.

The retailer captured 27.7% of the market, Kantar data showed, up 0.7 percentage points from a year ago and the biggest gain since November 2021.

Waitrose gained market share for the first time since January 2022, rising 0.1 percentage points to 4.5% as spending at the upmarket grocer rose 3.3%.

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Ocado (OCDO.L) was the fastest-growing grocer for the fifth month in a row, with sales rising 10.7% in the 12 weeks to July 7.

The key data was released just 24 hours before the official inflation figures for June were released.

Economists generally expect the consumer price index to fall to 1.9% from 2% in the previous month.

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