UK grocery inflation eases to 5.0 percent, offering limited relief at tills

UK grocery inflation edged down to 5.0 percent over the four weeks to 10 August, from 5.2 percent a month earlier, according to Worldpanel by Numerator. The latest reading, the most up-to-date snapshot of supermarket price trends, suggests a gradual cooling of food-price pressures but leaves inflation still well above pre-pandemic norms and a continuing constraint on household budgets.

“We’ve seen a marginal drop in grocery price inflation this month, but we’re still well past the point at which price rises really start to bite and consumers are continuing to adapt their behaviour to make ends meet,” said Fraser McKevitt, head of retail and consumer insight at Worldpanel. The firm said prices were rising fastest in categories such as chocolate, fresh meat and coffee, while falling quickest in champagne and sparkling wine, dog food and sugar confectionery.

The retail sector continues to cite higher employer taxes, regulatory costs and increased wages as ongoing pressures, even as some global commodity inputs ease. The British Retail Consortium has warned food inflation could approach 6 percent by year end, while the Bank of England expects a near-term pick-up before fading as external cost pressures diminish. Official UK inflation figures for July are due on Wednesday and will shape expectations for the path of interest rates into the autumn.

In the aisles, consumers remain price-sensitive and promotion-aware, trading down within baskets and leaning on loyalty schemes. Discounters continue to gain share, while the major multiples push private-label ranges and targeted offers. For suppliers, the focus is shifting to mix, innovation and cost discipline as volume growth stabilises.

While the latest print marks incremental progress, sustained relief requires a broader disinflation trend and stable energy and logistics costs. Until then, the squeeze on discretionary spending is likely to persist, keeping overall retail growth reliant on price rather than volume.