Price hikes in the baby, deli and dairy sectors this month helped to push basket prices up 1.3% a turnaround from the 0.3% fall reported in June.
Tesco prices increased the most (2.5%), followed by Sainsbury's (1.3%), Morrisons (0.9%) and Asda (0.5%), according to The Grocer Price Index, which collates the average prices of 1,000 items. Waitrose prices, which are not factored into the overall average, were also up in the month to 27 July, albeit just 0.2%. The uplift at Tesco was driven by increases in health & beauty, baby and deli prices.
In June, the largest price drops had been in the baby category and were driven by deep promotions on products such as Pampers. This month prices have risen 4.5% in this category as many of these key products came off promotion. The result was the average price of Morrisons' baby goods increasing by 7.6%, Sainsbury's by 6.2% and Tesco's by 3.9%.
The price of deli products rose by 4.3% across the big four, with Morrisons increasing prices by 10.1%, Tesco by 4%, Asda by 2.7% and Sainsbury's by 1.3%. Waitrose increased prices by 9.4%.
According to Brand View, which compiles the GPI data, this was not due to a reduction in promotions but to base price increases over the past five months particularly in the cooked meat category. For example, the price of own-label German salami at Asda has increased from £1 to £1.28, and at Sainsbury's it has risen from £1.39 to £1.56 over the period.
The 2.1% uplift in the average price of dairy goods was not the result of a general trend across the dairy market, said Brand View, but a limited number of price hikes on specific lines. For example, the price of Flora Buttery at Tesco has increased to £1.70 from an all-time low of £1.50. Dairy prices at Waitrose also increased by 2.8% during the four weeks to 27 July.
The price of tobacco, fruit and vegetables, soft drink, meat, fish and poultry remained fairly static, while alcohol prices increased 1.3% in the wake of the World Cup promotions last month.
Other categories that experienced price rises included health & beauty at 1.9%, biscuits, confectionery & snacks at 1.3% and dry products at 1.8%.