{"id":310922,"date":"2026-03-03T12:09:10","date_gmt":"2026-03-03T12:09:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/310922\/"},"modified":"2026-03-03T12:09:10","modified_gmt":"2026-03-03T12:09:10","slug":"uk-grocery-inflation-in-surprise-rise-as-experts-warn-of-worse-to-come-supermarkets","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/310922\/","title":{"rendered":"UK grocery inflation in surprise rise as experts warn of worse to come | Supermarkets"},"content":{"rendered":"

Shoppers faced a surprise jump in grocery inflation last month after four successive months of falls, as experts warned there was worse to come if there was prolonged war in the Middle East.<\/p>\n

In a blow to households struggling with the cost of living<\/a>, grocery price inflation rose to 4.3% in the four weeks to 22 February, after falling to 4% in January<\/a> from 4.7% in December<\/a>, according to the market research company Worldpanel by Numerator.<\/p>\n

The European Central Bank\u2019s chief economist, Philip Lane, also warned that prolonged war in the Middle East could lead to lower oil and gas supplies from the region, causing a \u201csubstantial spike\u201d in inflation and a \u201csharp drop in output\u201d in the eurozone.<\/p>\n

The prospect of a UK interest rate cut later this month receded on Tuesday morning, as UK government borrowing costs rose amid fears in the City over a potential spike in inflation.<\/p>\n

The interest rate, or yield, on two-year bonds has risen by 13.5 basis points (bps), while the 10-year yield jumped by 11bps and 30-year yields were up 9bps. Financial markets indicated a 29% chance of a cut this month, down from 80% last week.<\/p>\n

The crisis has already driven oil and gas sharply higher, threatening to push up prices at the pump for UK drivers and increase household gas and electricity bills.<\/p>\n

In an interview with the Financial Times<\/a>, the ECB\u2019s Lane said \u201cdirectionally, a jump in energy prices puts upward pressure on inflation, especially in the near term\u201d, and that such a development would be \u201cnegative\u201d for growth. This would also apply to the UK.<\/p>\n

Inflation in the eurozone rose to an annual rate of 1.9% in February, according to a preliminary estimate from the EU\u2019s statistics agency released on Tuesday. This was higher than economists had expected, and up from 1.7% in January.<\/p>\n

Fraser McKevitt, the head of retail and consumer insight at Worldpanel, said: \u201cLooking ahead to Easter, shoppers will notice that chocolate prices remain high, up 9.3% year on year.<\/p>\n

\u201cWhile this is still a significant rise, the pace of inflation in the category is beginning to ease and is now at its lowest level since September 2025.\u201d<\/p>\n

However, Greggs said \u201ceasing inflationary pressures\u201d should boost stronger consumer spending, as it revealed a near-18% drop in pre-tax profits to \u00a3167.4m in the year to 27 December.<\/p>\n

The Worldpanel report showed shoppers splashed out on recent celebrations. Pre-made pancake mixes were up 114% from the previous week in the seven days leading up to Shrove Tuesday, while those making their own batter paid 42p or almost 6% more than last year as the cost of key ingredients reached \u00a37.77.<\/p>\n

Nonetheless, sales of ingredients surged, with flour up 34%, sugar rising by 17% and lemons up 70%.<\/p>\n

Many shoppers left Valentine\u2019s Day spending until the last minute, with almost 12% of households picking up a premium meal deal on Friday night alone, according to Worldpanel.<\/p>\n

Steak buyers sprang into action later in the week, with sales peaking on Friday and Valentine\u2019s Day itself. Chocolate lovers also left it late, with Friday the single biggest day for purchases of Valentine\u2019s Day chocolate.<\/p>\n

People splashed out on premium dine-in experiences. In total, they spent \u00a339m on high-end meal deals priced at \u00a310 or more in the week leading up to Valentine\u2019s Day, seven times higher than the previous week.<\/p>\n

More people have been doing their grocery shopping online, with sales made through the internet up 9.7% year on year. More than 18m orders were placed over the four weeks, which meant online shopping made up 13% of total grocery sales, the highest level since July 2021.<\/p>\n

The online retailer Ocado was once again the fastest-growing grocer over the 12 weeks to 22 February, clinging to that spot since September, with 15.1% sales growth and a 2.1% share of the market. The discounter Lidl recorded double-digit sales growth for the 12th consecutive month, up 10% and 7.8% market share.<\/p>\n

Tesco, the biggest supermarket chain, increased sales by 4.5% to raise its market share to 28.5%, while Sainsbury\u2019s upped its market share to 16.1% as sales rose by 5.2%.<\/p>\n

Waitrose, part of the John Lewis Partnership, achieved its highest rate of sales growth since March 2021, at 5.6%, to reach market share of 4.8%, a three-year high.<\/p>\n

Asda once again recorded a dip in sales year on year, this time by 2.6%, while Co-op\u2019s sales were down 1.6%.<\/p>\n","protected":false},"excerpt":{"rendered":"Shoppers faced a surprise jump in grocery inflation last month after four successive months of falls, as experts…\n","protected":false},"author":2,"featured_media":310923,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[138,219,111,139,69],"class_list":["post-310922","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-new-zealand","tag-newzealand","tag-nz"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/310922","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=310922"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/310922\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/310923"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=310922"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=310922"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=310922"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}