Food inflation in the UK has slowed from April’s record-breaking rise – but is still up more than 15% on the year, new retail figures show.
Research by the British Retail Consortium (BRC) and Nielsen shows a 15.4% rise in food inflation in the year to May.
It is the second-fastest annual increase that the BRC – the trade organisation for UK retailers – has ever measured.
However, it is down slightly compared with April’s record-breaking increase of 15.7%.
The group’s chief executive, Helen Dickinson, said there was reason to believe food inflation “might be peaking”.
However, the slowing of food inflation did not result in a slow-down of overall inflation in shops.
That rose from 8.8% to a record 9% between April and May, the BRC said.
“While overall shop price inflation rose slightly in May, households will welcome food inflation beginning to fall,” Ms Dickinson said.
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She said the slowing was likely a result of lower energy and commodity costs beginning to filter through to lower prices on some staples, such as butter, milk, fruit, and fish.
However, she warned the government against plans to introduce new price caps on essential items.
The warning comes after it was reported that Downing Street was drawing up plans to encourage supermarkets to introduce voluntary price caps on food staples in a bid to help with the cost of living crisis.
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“While there is reason to believe that food inflation might be peaking, it is vital that Government does not hamper this early progress by piling more costs onto retailers and forcing up the cost of goods even further,” Ms Dickinson said.
Mike Watkins, head of retailer and business insight at NielsenIQ, said: “To help mitigate the impact of inflation, shoppers are saving money by looking for seasonal promotions on the high street and taking advantage of the price reductions offered by supermarket loyalty schemes.
“Food retailing in particular is competitive, so hopefully the recent price cuts in fresh foods is a sign that inflation has now peaked, albeit ambient inflation may take a little while longer to slow.”
It comes after Chancellor Jeremy Hunt backed interest rate hikes, even if they risk of plunging the UK into recession, in order to combat soaring inflation.
Experts have also previously warned that alarmingly expensive food is set to overtake energy bills as the “epicentre” of the cost of living crisis.