Shop prices rise at fastest rate in a decade
The figure from the BRC-NielsenIQ Shop Price Index marks the highest rate of shop price inflation since November 2011.
Food inflation remained the key driver behind higher prices, particularly for fresh food which has been impacted by poor harvests, both in the UK and globally.
Food inflation remained unchanged at 2.7% in February, but it still remains above the 12 and six-month average price growth rates of 0.7% and 1.6% respectively, and is at its highest rate since September 2013.
Increased health, beauty, and furniture prices also contributed to the inflationary increase from January. Non-food inflation rose from 0.9% in January to 1.3% in February, its highest rate since September 2011.
Helen Dickinson OBE, British Retail Consortium chief executive, said: “Price rises will be unwelcome news for households who already face falling disposable income because of the rise in national insurance and energy price caps. Retailers continue to face cost pressures from higher shipping rates, with crude oil prices having almost doubled over the last year.
“Other pressures include labour shortages, commodity price increases, and rising energy prices. Retailers are going to great lengths to mitigate against these price rises and support their customers, for example, many supermarkets have expanded their value ranges for food. Unfortunately, there are limits to the costs that retailers can absorb.”
Mike Watkins, NielsenIQ head of retailer and business insight, said: “Inflation has increased since the start of the year and the underlying trend in shop prices will be upwards over the next few months.
“With falling disposable income for most households, retailers will need to keep encouraging customers to spend by offering choice and value and for some, discounts as well as added benefits for loyal shoppers.”
Inflation hit a 30-year high in January, reaching 5.5% in the 12 months to January 2022, up from 5.4% in December 2021, according to the Office for National Statistics (ONS).