Supermarket prices are rising at the fastest rate in 4 years as Brexit hits shoppers hard

Will Martin
A shopper checks her shopping list in a supermarket in London, Britain April 11, 2017. British inflation shot past the Bank of England's 2 percent target last month, potentially adding to uneasiness among some officials at the central bank about keeping interest rates near zero. Consumer prices rose by a stronger-than-expected 2.3 percent, the biggest annual increase in nearly three-and-a-half years, pushed up by an increase in global oil prices and the impact of the Brexit vote on sterling.

REUTERS/Neil Hall


  • Grocery prices increased 3.4% in the last quarter as Brexit driven inflation continues to bite.
  • "Prices are rising fastest in markets such as butter, fish and cola," market research firm Kantar Worldpanel said.
  • Lidl and Aldi continue to grow rapidly, with Lidl Britain’s fastest growing supermarket for the fifth consecutive quarter.


LONDON — Grocery prices are rising at their fastest rate in four years as the growing cost of imports since the Brexit vote forces retailers to increase prices, according to the latest survey from Kantar Worldpanel.

The sharp fall in the value of the pound following the UK's vote to leave the EU last year has raised the cost of imports and pushed up the rate of inflation, which is now being passed on to UK consumers.

Rising supermarket prices are perhaps the most visible sign of the wider growth in inflation since last June, and that is reflected in Kantar's data, which showed grocery inflation at 3.4% in the 12 weeks up to November 5.

"Prices have been rising since the 12 weeks to 1 January 2017, following a period of grocery price deflation which ran for 30 consecutive periods from September 2014 to December 2016," the market research firm said.

"Prices are rising fastest in markets such as butter, fish and cola and are falling in only a few markets, including crisps and fresh poultry."

"With the average shop currently costing £18.26, consumers are now paying an extra 62 pence each time and over the course of a year it could add £143.70 to a typical family’s grocery bill," Fraser McKevitt, Kantar's head of retail and consumer insight said in a statement.

Tuesday's data from Kantar comes just before the Office for National Statistics releases its official data on the state of inflation in the UK in October. The ONS' numbers are expected to show that consumer price inflation — which measures a weighted average of prices of a basket of goods and services, such as food, transportation, and medical care — hit 3.1% in the month, a level not seen in over five years.

Alongside its data on the rising price of supermarket shopping, Kantar's survey showed that German discount supermarkets Aldi and Lidl continue their relentless assault on Britain's traditional big supermarkets, growing their total sales rapidly over the last quarter.

"Lidl is Britain’s fastest growing supermarket for the fifth consecutive period, with sales up 15.1%," Kantar said.

"New store openings – and the opportunity they bring to attract new shoppers – have contributed to the impressive
performance."

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