According to researchers who produced a widely followed report, supply chain disruption caused by attacks on shipping in the Red Sea was not the primary cause of recent pricing variations, but rather the “battle” between stores to win over shoppers.
According to industry statistics, people’s alcohol spending decreased by more than half in January compared to December due to Dry January and other health-related issues.
It comes as data indicates that the recent trend of a steady slowdown in the rise of grocery prices was virtually stopped in January as stores reduced their post-Christmas special deals.
The percentage of yearly price increases for food, drink, and other home necessities remained high at 6.8% for the four weeks leading up to January 21, according to Kantar Worldpanel, a company that measures sales across chains.
Compared to the 6.9% grocery inflation rate in December, it was only a 0.1% decrease.
Separate data, also released on Tuesday, from NielsenIQ and the British Retail Consortium (BRC), a trade group that represents supermarkets, are, nevertheless, more optimistic.
According to their analysis, the inflation of shop prices, which cover both food and non-food products like clothing, decreased this month to its lowest point since May 2022.
The majority of the decline, according to BRC CEO Helen Dickinson, was caused by promotions for non-food products. On the other hand, a decrease in the cost of milk and tea was also mentioned.
Towards the close of the previous year, both the rate of increase in food prices and the more general consumer price index (CPI) of inflation had been decreasing.
However, the CPI unexpectedly increased earlier this month, and there is growing fear that the attacks on shipping related to the Israel-Hamas conflict would soon impede supply routes in the Red Sea, driving up costs.
