UK grocery prices have increased at their fastest pace for 18 months amid growing concern from shoppers about the rising cost of living, according to new figures. The acceleration marks a significant blow to household budgets already stretched by economic pressures.
Grocery price inflation jumped to 5.2% in the four weeks to July 13, according to market research firm Worldpanel by Numerator, which was recently renamed from Kantar. This represented a rise from inflation of 4.7% a month earlier and marked the highest level since January 2024.
Annual bills set to rise
The data indicated that rising prices are set to add an average of £275 to shoppers' annual grocery spending. Nearly two thirds of households say they are very concerned about the cost of their grocery shopping, prompting widespread changes to shopping habits.
Fraser McKevitt, head of retail and consumer insight at Worldpanel, said: "Just under two thirds of households say they are very concerned about the cost of their grocery shopping, and people are adapting their habits to avoid the full impact of price rises." He noted that own label products continue to outperform branded goods, with sales growing 5.6% compared to 4.9% for brands.
Simpler meals as budgets tighten
Shopping data also showed that consumers have been cooking simpler meals in recent months as part of efforts to stick to budgets. The price increases come amid commodity price pressures and higher costs for retailers following recent increases in National Insurance contributions and the national minimum wage.
Overall consumer spending across UK grocers rose by 4.6% over the 12 weeks to July 13, according to Worldpanel data. Online retail specialist Ocado saw the fastest rise in sales over the period with 11.7%, closely followed by German discount chain Lidl at 11.1%.
Market share shifts continue
Lidl's strong performance took its share of the UK grocery market to 8.3%, moving it close to the size of rival Morrisons. The UK's largest supermarket chain Tesco increased its market share further after growing sales by 7.1%.
Asda and the Co-op were among the weaker performers, with sales declining 3% and 3.7% respectively over the quarter.
(PA/London) Note: This article has been edited with the help of Artificial Intelligence.
