Soaring food costs send shop price inflation higher
Soaring food costs pushed shop price inflation higher in December, fresh data has revealed, as Brits faced the crunch during the Christmas season.
Food inflation reached 3.3 per cent in the final month of 2025, up from three per cent in November, with fresh produce rising to 3.8 per cent from 3.6 per cent previously. This edged just below the nine-month average of 3.9 per cent.
This towered above broader shop price inflation at 0.7 per cent, according to data from the British Retail Consortium (BRC) and NIQ.
Helen Dickinson, BRC chief executive, said: She said: “This year, retailers will continue to do all they can to keep prices down.
“While falling energy prices and improved crop supply should help ease some cost pressures, increased public policy costs and regulation will likely keep inflation sticky.”
Food inflation driving Brits’ fears
A survey from KPMG last month said an overwhelming majority of Brits (81 per cent) who believed the UK was getting worse cited the cost of groceries as the top sentiment driver.
Ahead of Rachel Reeves’ second Autumn Budget, the UK’s largest supermarkets wrote to the Chancellor calling for the Treasury to bring “inflation to a heel”.
“Given the costs currently falling on the industry, including from the last Budget, high food inflation is likely to persist into 2026,” bosses from the likes of Tesco, Lidl and Morrisons warned.
Mike Watkins, head of retailer and business insight at NIQ, said “weak shopper sentiment” was likely to persist in 2026, despite inflation expecting to have peaked.
Customers were brought some reprieve in the festive season as deflation on products other than food steadied at 0.6 per cent.
The inflation rate tumble to 3.2 per cent from 3.6 per cent in November – a larger fall than analysts had pencilled in, but still well-above the Bank of England’s two per cent target.
Food prices were the biggest driver, with the Office for National Statistics noting “decreases seen particularly for cakes, biscuits, and breakfast cereals”.
Still beef prices were recorded up a colossal 27.7 per cent year-on-year, whilst chocolate was up 17.3 per cent and milk 14.8 per cent.