Shoppers see sharpest price rises since 2012 as cost of living crisis bites

Shoppers have been hit by the highest price rises in almost 10 years after shop inflation almost doubled over the past month, new data suggests.

According the latest BRC-NielsenIQ shop price index, annual shop price inflation jumped from 0.8% in December, to 1.5% in January, the highest rate since 2012.

Food inflation rose from 2.4% in December to 2.7% in January, as price rises reached the highest rate since October 2013,

Ambient food inflation also jumped to 2.4% in January compared with 1.7% in December, which is the highest increase since November 2020.

The figures, from the British Retail Consortium and research firm NielsenIQ, measured inflation across retailers in the UK over the first week of January, assessing price changes for 500 commonly bought items.

Their data also found that non-food inflation, which includes items such as fashion and furniture, rose to 0.9% in January compared to 0.2% in December.

British Retail Consortium CEO Helen Dickinson, said: “January saw shop price inflation nearly double, driven by a sharp rise in non-food inflation.

“In particular, furniture and flooring saw exceptionally high demand leading to increased prices as the rising oil costs made shipping more expensive.

“Food prices continue to rise, especially domestic produce which have been impacted by poor harvests, labour shortages, and rising global food prices.”

Dickinson also said this will directly affect the cost of living crisis, stating “it would be impossible to protect consumers from any future rises” in costs.

However, fresh food inflation did slow slightly from 3.0% in December to 2.9% in January, but is still above the 12-month and six-month average growth rates.

NielsenIQ head of retailer and business insight Mike Watkins, said: “The surge in energy and travel costs is now impacting disposable incomes and is likely to dent consumer’s willingness to spend.

“NielsenIQ research this month shows nearly a half of all households are saying that their most important concern at the moment is the rising cost of living.”