Increasing food prices added to the higher than expected increase to UK inflation in the year to June.
The latest official figures from the Office for National Statistics (ONS) put UK inflation – as measured by the Consumer Price Index (CPI) – at 3.6%, up from 3.4% in May.
According to the ONS, prices for food and non-alcoholic beverages rose by 4.5% in the year to June, the highest rate since February 2024.
Mike Watkins, head of retailer and business insight at NIQ, said increasing inflation would concern High Street retailers hoping to retain customers over the summer holiday season.
“Consumers’ household budgets are coming under pressure with the food retailers now seeing price increases above CPI,” he said.
“However, price competition helped by promotional activity will still mean that shoppers can save money by shopping around.
Ms Dickson said there were “a few bright spots” in the research, “with discounts in fashion and furniture offering consumers a chance to refresh their wardrobe and homes.”
Overall shop price inflation increased to 0.7% from 0.4% in June, and up from the three-month average of 0.3%.
Last week, separate research from Worldpanel by Numerator found that food prices had risen by 5.2% compared to last year, led by price increases for chocolate, butter, spreads and fresh meat.