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Fresh perspective: the decline in UK grocery inflation and the rise of fresh deals

The UK has witnessed a notable deceleration in grocery price inflation. According to market data firm Kantar, prices were 11% higher in the four weeks leading up to 1 October, marking the lowest rate since July of the previous year.

Tom Steel, the strategic insight director at Kantar, commented, “For the first time since last year, the prices of some staple foods are now dropping, which is helping to bring down the wider inflation rate.”


While dairy products, particularly butter, saw a decrease in price, other areas such as vegetables have also been affected. The British Retail Consortium highlighted that reductions in prices for veg and other fresh produce, combined with intense supermarket competition, have contributed to the decrease in the average cost of a food basket.


Shoppers have been increasingly looking for promotional deals to counteract the impact of rising prices. Kantar noted that the percentage of groceries bought on deal surged to 26.5% in the recent 12 weeks, the highest since the previous June.


Steel added, “Supermarkets are exploring various ways to offer value at the checkout. While there has been a focus on everyday low prices, we're now seeing more promotional deals.”


The warmer weather also influenced shopping habits, with a surge in sales of fresh items suitable for barbecues and picnics. However, the early sales of seasonal items like Christmas puddings saw a decline.


This shift in grocery trends has implications for major supermarkets in the UK. Tesco, the country's largest supermarket, reported a 9.2% sales increase over the past 12 weeks. Meanwhile, discounters like Lidl and Aldi have seen significant growth, reflecting their appeal during the ongoing cost of living crisis.


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