Food price inflation continued to ease in December, new figures show.
The latest monthly Shop Price Index from the British Retail Consortium (BRC) and Nielsen IQ reveals that food inflation slowed to 6.7% last month, from 7.7% in November, continuing the downward trend for an eighth consecutive month.
Non-food inflation rose to 3.1%, from 2.5% in November, after Black Friday discounting and ahead of the January sales.
As a result, overall shop price inflation remained steady at 4.3%.
Mike Watkins, head of retailer and business Insight at NielsenIQ, said that during December “there was a lot of pressure on discretionary spend and price discounting was deeper and began earlier not just in the non-food channel but also in food retail, where promotions got back to a four-year high at the end of the year”.
BRC chief executive Helen Dickinson highlighted “obstacles on the road ahead” for retailers in 2024, including new border checks for EU imports and higher business rates bills from April.
“Government should think twice before imposing new costs on retail businesses that would not only hold back vital investment in local communities, but also push up prices for struggling households,” Dickinson added.
The Bank of England has held interest rates at 5.25%, a 15-year high, after 14 consecutive increases aimed at curbing inflation. Officials have said it is too early to consider cutting the base rate.