UK Shop Price Inflation Hits Near 2-Year High

UK shop price inflation rose 1.5% year-on-year in January 2026, the highest level since February 2024 and well above expectations of a 0.7% increase, as higher business energy costs and the National Insurance hike continued to feed through to prices. Non-food prices rose 0.3% year-on-year in January, reversing a 0.6% decline in December and compared with a three-month average fall of 0.3%. Food inflation accelerated to 3.9% in January from 3.3% in December, exceeding the three-month average of 3.4%. Fresh food inflation picked up to 4.4% from 3.8%, while ambient food inflation rose to 3.1% from 2.5%, both above recent averages. BRC Chief Executive Helen Dickinson said shop price inflation jumped due to elevated energy costs and tax increases, with meat, fish and fruit particularly affected amid weak supply and stronger demand.

UK shop price inflation rose to 0.7% year-on-year in December 2025 from 0.6% in November, marking its first acceleration in three months, driven by higher food costs during the holiday period. Food price inflation increased to 3.3% year-on-year from 3% previously, with fresh food prices quickening to 3.8% from 3.6%. Ambient food prices also edged higher, rising to 2.5% from 2.4%. By contrast, non-food prices continued to decline, with inflation at minus 0.6% year-on-year in December, unchanged from November. BRC Chief Executive Helen Dickinson said shop price inflation edged higher in December as food prices rose at a faster pace. However, she noted that shoppers still found good value across many Christmas essentials, including vegetables, cheeses, and alcohol, helping households enjoy the festive season. Dickinson added that falling energy prices and improved crop supply should help ease cost pressures in the year ahead.

UK shop price inflation eased to 0.6% in November 2025 from 1.0% in the prior month, marking a second consecutive monthly decline and the lowest rate since June, according to the British Retail Consortium and NielsenIQ. The latest reading came in below the three-month average of 1.0%, reflecting earlier and more aggressive Black Friday discounting. Food inflation slowed (3% vs 3.7% in October), undershooting its three-month average of 3.7%, though items such as oils, fats, meat, and fish remained elevated. Meanwhile, non-food prices fell further (-0.6% vs -0.4%), below the three-month average of a 0.3% fall. BRC Chief Executive Helen Dickinson said that with budget uncertainty now resolved, retailers are hopeful that confidence will recover during the crucial holiday trading period, adding that they will continue working to keep prices down. However, she warned that rising employment costs in the new year could feed into prices, potentially weighing on already fragile consumer mood.