According to the report from market researcher Kantar, UK grocery inflation dropped sharply in July, coinciding with the fastest rise in monthly supermarket shopper numbers so far this year.
The data showed that in the four weeks to July 7, annual grocery price inflation fell to 1.6% from 2.1% in the previous four-week period. Kantar said that the largest price reductions were recorded for toilet tissues, butter and dog food, while prices for vitamins, minerals and supplements, chilled fruit juices and drinks, as well as deodorants continued to rise.
The data also showed that take-home grocery sales increased 2.2% per annum in value terms over the four-week period. Kantar highlighted a boost to sales of beer, crisps and snacks from the Euro 2024 soccer championship.
According to official data, in May, overall consumer inflation fell to the target level of 2% for the first time in almost three years. Meanwhile, CPI data for June will be released tomorrow, which may affect the results of the next meeting of the Bank of England, which will be held on August 1. Economists expect the CPI to rise again by 2% per annum, but on a monthly basis, inflation slowed to 0.2% from 0.3% in May.