British households face an extra £788 on their annual shopping bill as the cost of groceries continues to rise in January, indicative data by market researcher Kantar has found.
Grocery price inflation hit 16.7 percent in the four weeks to January 22, the fastest pace since Kantar began tracking the figure in 2008. The January rate was 2.3 percentage points above the December reading. Prices for milk, eggs and dog food are rising the fastest.
“At the end of last year, we saw the rate of grocery price inflation decline slightly, but the signs of small relief for consumers have subsided,” said Fraser McKevitt, Kantar’s head of retail and consumer insights, with the rate “entering the previous high we recorded in October”.
Annual food price inflation was 16.8 percent in December, according to the latest figures from the Office for National Statistics.
Grocers are competing for customers by increasing their own-label ranges, which rose 9.3 per cent in January, outpacing branded alternatives, which rose 1 per cent.
High food prices are also causing shoppers to shift to discount chains, according to Kantar. Aldi, which claimed 9.2 percent of the market, was the fastest growing grocer for the fourth consecutive month, with sales 26.9 percent higher than the previous year. Rival Lidl generated 24.1 percent more sales.
Many are committed to their new year’s resolutions to avoid alcohol, increasing the volume of non-alcoholic and alcoholic beers up to 3 percent.
UK inflation, at 10.5 percent last month, has receded from a 41-year peak in October, leaving the Bank of England set to reveal whether interest rates will peak at 4.25 percent or 4.5 percent. The central bank is expected to raise rates by 0.5 percentage points to 4 percent, the tenth consecutive increase, when it meets there.