The headline figure may be less dramatic this month, but don’t be fooled inflation is getting worse, with a growing number of categories now reporting rising prices.
In January, The Grocer Price Index showed prices up massively in two categories, alcohol rising 8% and frozen food 5.6%. Six of the 15 categories showed prices stable or falling, while three reported uplifts of less than 0.5%.
This month, grocery bills rose 1.1% compared with 2.6% in January and the individual category rises were also less acute. However, they were felt across 10 of the 15 categories, with eight reporting increases of 0.5% and above. Only fruit & vegetables, biscuits, confectionery and snacks, chilled, dry grocery and household reported stable or falling prices.
Some of the biggest increases came in categories that were also hit hard last month. Frozen foods was already up 2.7% and alcohol 2.1% in January.
These price rises are even more alarming given that the GPI is the only food price tracker that factors in promotions to give the true cost of a trolley of groceries.
Other categories to experience sizeable hikes this month were soft drinks and health & beauty, although these followed a modest increase and a fall in price respectively last month.
Input costs have risen across the board following global price hikes to oil and agricultural commodities, but it is the VAT rise that has had the biggest impact on soft drinks, says a spokesman for the British Soft Drinks Association. “Even though VAT happened in January, it is not unusual for it to take some time for price changes to filter through to retailers’ shelves.”
On the retailers’ side, February proved a mixed bag. Prices in Sainsbury’s went up the most, rising 3.5% off the back of double-digit price hikes on alcohol (up 10.1%) and frozen foods (up 10.6%).
Elsewhere, increases were more modest, Tesco’s and Morrisons’ prices up 0.5% month-on-month, with Asda the only one of the big four to report a fall. In Waitrose, whose prices are not covered by the overall price index, babyfood was up 7% on last month.