UK shop price inflation at lowest since June 2022 -BRC

Shoppers push trolleys along an aisle inside an ALDI supermarket near Altrincham, Britain, Feb 20, 2023. REUTERS/Phil Noble/File photo

LONDON  – Shoppers at British store chains have seen the slowest increase in prices in almost a year and a half but retailers might struggle to keep inflation on its downward path, an industry group said on Tuesday.

The British Retail Consortium said annual shop price inflation dropped to 4.3 percent in the 12 months to November, its weakest since June 2022 and slower than October’s 5.2 percent rise.

It was the sixth month in a row that the pace of price growth weakened.

Food price inflation fell to 7.8 percent from 8.8 percent on the year but rose 0.3 percent in November from October.

Non-food inflation eased to an annual 2.5 percent from 3.4 percent.

BRC chief executive Helen Dickinson said there was a risk that the fall in inflation could stall or go into reverse because of rising business rates – a property-based tax – plus new regulations and a jump in the minimum wage.

Britain’s broader official consumer price inflation peaked at 11.1 percent in October 2022 and was 4.6 percent in October this year.

The Bank of England has paused its run of interest rate increases after 14 consecutive hikes. But Governor Andrew Bailey and other top officials say it is too early to think about cutting borrowing costs.