UK grocery inflation eases to nine‑month low of 4%, says Worldpanel

UK grocery inflation eased to 4 per cent in the four weeks to January 25, the lowest level since April last year, providing some relief to shoppers, data from market researcher Worldpanel by Numerator showed on Tuesday.

Grocery inflation was 4.3 per cent in its previous report.

The figure from Worldpanel provides an early indication of pricing pressures ahead of official UK inflation data on February 18.

The Bank of England is watching food prices closely as it believes they play a key role in shaping the public’s overall inflation expectations. Britain’s headline inflation rate rose to 3.4 per cent in December, the highest in the Group Seven rich economies.

Worldpanel said UK grocery sales rose 3.8 per cent over the four week period year-on-year in value terms – a decline in volume terms after inflation is taken into account.

“While grocery sales continue to grow and inflation eased to its lowest level in months, value remained front of mind for many – with own label hitting a record high, accounting for more than half of all grocery spend,” said Fraser McKevitt, head of retail and consumer insight at Worldpanel.

Over the 12 weeks to January 25, industry leader Tesco’s sales rose 4.4 per cent year-on-year and its market share grew 20 basis points to 28.7 per cent. Number two Sainsbury’s sales increased 5.3 per cent, taking its share to 16.2 per cent.

Discounter Lidl GB remained the fastest growing bricks-and-mortar retailer, with sales up 10.1 per cent, while online supermarket Ocado remained the fastest growing overall, with sales up 14.1 per cent.

Number three player Asda continued to struggle – its sales fell 3.7 per cent, giving it a market share of 11.5 per cent, down 80 basis points on the year.