Food inflation has fallen sharply after July’s record month-on-month rise, according to the latest figures from the Grocer Price Index (GPI). Food prices increased 1.3% this month, compared with a 4.2% rise in July, leading analysts to predict food prices may be nearing a peak.

Morrisons, previously the retailer with the tightest grip on inflation, saw the sharpest increase, its total basket rising from £202.61 in July to £209.54 this month – a 3.4% uplift. Tesco and Sainsbury’s showed the smallest increases at just 0.4%, eight times less than Morrisons’, and Asda’s prices went up 1.1% month-on-month.

Tesco and Sainsbury’s low inflation could be due to a tighter focus on promotions, which Morrisons has already shown for several months, said Verdict retail analyst James Flower. “Morrisons have tried to keep their prices low over the past few months,” he said. “But now they’ve had to pass higher costs on to defend their margins.”

Food prices have increased 18.7% since last August, but the slower rate of increase this month suggests lower oil and commodity prices may be starting to filter through.

“Month-on-month price growth is slowing quite sharply,” said a spokesman for the British Retail Consortium. “This is a good indication food prices are starting to peak.”