UK grocery inflation fell for the sixteenth consecutive month in June, according to industry data released on Tuesday, offering some positive news for Prime Minister
Rishi Sunak ahead of the upcoming election in July.
Market researcher Kantar reported that annual grocery price inflation was 2.1% for the four weeks ending June 9, a slight decrease from 2.4% in the previous four-week period.
In the lead-up to the July 4 election, Sunak has emphasized his role in more than halving overall inflation. However, this has yet to translate into a significant boost in opinion polls for his Conservative Party, which continues to trail behind the opposition Labour Party.
Kantar noted that prices were decreasing in nearly one-third of the grocery categories it monitors, including toilet tissues, butter, and milk. Conversely, prices continued to rise in categories such as chilled fruit juices and chocolate confectionery.
Tesco, the market leader, stated on Friday that it expects “very low single-digit” food inflation for the remainder of 2024.
Official UK data released on May 22 indicated that overall consumer price inflation fell to 2.3% in the 12 months to April. Inflation data for May is scheduled for release on Wednesday, ahead of the Bank of England’s policy announcement on Thursday.
Kantar’s data, offering the most current snapshot of UK consumer behavior, showed a 1.0% year-on-year increase in take-home grocery sales in value terms over the four-week period—the slowest growth since June 2022, attributed to poor weather and declining inflation.
“We’re not yet reaching for those typical summertime products and are making some purchases you wouldn’t expect in June,” said Fraser McKevitt, head of retail and consumer insight at Kantar. He noted that consumers bought nearly 25% fewer suncare items and 11% fewer prepared salads compared to last year, while fresh soup sales surged by 24%.
McKevitt added that supermarkets are hoping for a sales boost from the Euro 2024 soccer championship, with promotions on beer and lager increasing to over 40% in the latest four weeks.
Over the 12 weeks ending June 9, online supermarket Ocado continued to be the fastest-growing grocer, alongside Tesco, No. 2 Sainsbury’s, and discounter Lidl, all of which gained market share. Asda, however, remained the laggard, losing 90 basis points of market share year-on-year. Photo by Chris Talbot, Wikimedia commons.