Food prices fell at their fastest rate in almost five years in October, with confectionery and chocolate prices coming down just in time for Halloween.
Prices dropped 0.4% compared to the month before, the biggest monthly fall since December 2020, according to the latest shop price index from the British Retail Consortium (BRC).
Sweet treats were the big driver as tumbling global sugar prices – down more than 25% since the start of the year – helped lower manufacturing costs.
It meant annual food inflation cooled to 3.7% from 4.2% in September, although the picture was mixed across the aisles. While ambient food inflation, which includes confectionery and canned goods, fell to 2.9% from 4.2%, fresh food inflation moved higher to 4.3% from 4.1% in September.
Prices of non-food items were 0.4% lower than a year ago as retailers brought in big discounts on electricals and beauty goods ahead of Black Friday.
“Overall shop price inflation slowed in October, driven by fierce competition among retailers and widespread discounting,” said Helen Dickinson, BRC CEO.
The BRC inflation data precedes the official numbers from the Office for National Statistics which come later next month.
After the recent International Monetary Fund (IMF) recently warned the UK will have the highest inflation rate in the G7, Dickinson said policy reform is crucial to avoid prices moving even higher.
Supermarket bosses, including from Tesco, Asda, Sainsbury’s and Morrisons, published a letter to Chancellor Rachel Reeves on Sunday stating food prices will rise further if the government imposes more taxes at the next budget.
“Our ability to absorb additional costs is diminishing,” they wrote in a joint letter. “If the industry faces higher taxes in the coming budget – such as being included in the new surtax on business rates – our ability to deliver value for our customers will become even more challenging.
“Given the costs currently falling on the industry, including from the last budget, high food inflation is likely to persist into 2026. This is not something that we would want to see prolonged by any measure in the budget.”
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