UK grocery inflation edges higher over last month, says Worldpanel

By James Davey

LONDON, Sept 15 (Reuters) - British grocery price inflation increased to 2.3% over the four weeks to September 6, market researcher Worldpanel by Numerator said on Tuesday, putting more pressure on households grappling with elevated living costs.

The rise compared to 2.1% in last month's report, with prices rising fastest in markets such as fresh fish and skincare.

The Worldpanel data is the most up-to-date snapshot of UK consumer behaviour, providing an early indication of food pricing pressures in September. Official UK inflation data for August will be published on Wednesday.

FOOD INFLATION FORECAST TO RISE

UK food inflation has not hit the levels that were forecast earlier in the year, reflecting fierce supermarket competition, consumers' resistance to further price rises and better hedging by suppliers.

Last week the Food and Drink Federation industry body said food price inflation is likely to climb to nearly 4% by the end of the year and exceed 6% by the middle of 2027 due to the ongoing impact of the U.S.-Iran war, drought in Europe and the El Niño weather pattern.

While Britain's new Prime Minister Andy Burnham has made tackling the cost of living a priority, headwinds to consumer spending will strengthen from October when most UK households will see their energy bills rise.

The Worldpanel data showed UK grocery sales increased 2.0% over the four weeks year-on-year, indicating lower sales on a volume basis once inflation is taken into account.

Worldpanel said that over the 12 weeks to September 6, industry leader Tesco's TSCO.L sales rose 1.7% year-on-year, but its market share edged lower for the fourth report in a row. Sales at number-two Sainsbury's SBRY.L rose 2.9%.

While Marks & Spencer MKS.L isn't fully included in the Worldpanel data set, it remained the UK's fastest-growing food retailer with a 14.8% rise in sales of groceries.

Online supermarket Ocado OCDO.L was the second fastest growing with a 13.3% increase, followed by discounter Lidl with growth of 8.0%.

Number-three Asda returned to sales growth for the first time since March 2024.

UK supermarkets' market share and sales growth (%)

Source: Worldpanel by Numerator