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Supermarket inflation is now at its highest level since Christmas 2013 as shelf prices have risen to reflect markedly increased input costs.

The Grocer Price Index, collated from over 60,000 individual supermarket SKUs by Brand View, shows annual inflation for the month to 1 April standing at 1.4%. That represents the highest grocery inflation since the month to 1 January 2014, when prices were up 2.1% year on year before deflation first hit in the month to 1 June 2014.

The latest GPI marks a 0.9 percentage point jump in inflation since the 0.5% annual price rise recorded in the month to 1 March. Deflation has been falling back ever since the month to 1 June 2016 to move into inflationary territory last month.

This month the biggest price jump was recorded in alcoholic drinks, which was up 3.4% year on year compared with inflation of 0.9% the previous month.

The other most significant contributors to annual inflation are baby goods (+2.3%), chilled (+1.7%), and meat, fish & poultry (+1.7%) - the latter having dramatically risen from annual category deflation of -4.8% just five months ago.

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Morning update

The Grocer also has the story that Pre-tax profits at Tayto Group more than halved to £3.1m last year as sales declined and the Northern Irish snack maker continued to invest in the business.

Revenues fell 6% to £163.3m in the 12 months to 25 June 2016 - with a 19.5% fall in Golden Wonder’s value, according to The Grocer’s Top Products Survey last year. The decline is a wider reflection of the crisps market as consumers move towards shared, premium and healthier snacks.

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On the markets this morning, The FTSE 100 is flat at 7,305.3pts.

Ocado (OCDO) has slumped 4.6% to 240.4p in early trading this morning, while Hotel Chocolat (HOTC) is also down 4.6% to 300.6p.

Ocado apart, its a much better morning for the supermarkets which are amongst the FTSE 100’s biggest risers. Tesco is up 2.1% to 189.2p, Sainsbury’s (SBRY) up 1.7% to 258.6p and Morrisons (MRW) up 1.1% to 233,2p to end a tough week on the front foot.

Other risers include Booker Group (BOK), up 1.2% to 197.2p and Finsbury Food Group (FIF), up 1.4% to 106.9p.

Unilever’s share price remains stable at 3,980.2p after yesterday’s strategic review.

Yesterday in the City

Unilever shares closed up 1% to 3,978p yesterday as the City absorbed the findings of its strategic review. The results of the review were largely in line with expectations – including the sell-off of its spreads division – but some investors were pushing Unilever to go further. Also concerns were raised about the impact on future growth Unilever’s plans to cut its marketing could have.

The FTSE 100 ended the day down 0.4% at 7,303.2pts after recovering somewhat from an early morning slump on market worries ahead of the meeting between President Trump and Chinese Premier Xi.

The listed supermarkets continue to have tough weeks, with Sainsbury’s (SBRY) and Morrisons (MRW) down 0.7% to 254.4p and 0.7% down to 230.7p respectively.

Also falling yesterday was Greggs (GRG), down 1.4% to 1,027p and Associated British Foods (ABF), down 1.2% to 2,502p.

Other fallers included Nichols (NCLS), down 3% to 1,899p, Conviviality (CVR), down 2.4% to 263.5p and C&C Group (CCR), down 1.9% to €3.67.

Real Good Food (RGD) jumped another 9.4% to 35p following its acquisition of Brighter Foods earlier this week.

Also rising were FeverTree (FEVR), up 2.6% to 1,553p, Hotel Chocolat (HOTC), up 2.6% to 315p, B&M European Value Retail (BME), up 2.4% to 313p and Ocado Group (OCD), up 2.2% to 252p.