Supermarket price inflation has fallen to its lowest level since March 2022, as promotions accelerated and supermarkets continued to focus on price. Grocery price inflation fell to 5.3% in February, marking the lowest rate since March 2022 and a decrease of 1.5% from January.
Things are looking up for shoppers this February. Consumers have been navigating a grocery inflation rate of more than 4% for two years now, so this latest easing of price rises is especially welcome. Though there’s been lots of discussion about the impact the Red Sea shipping crisis might have on the cost of goods, supermarkets have been pulling out all the stops to keep prices down and help people manage their budgets.
More generally, promotions accelerated this month after a post-Christmas slowdown. Consumers’ spending on offers increased by 4% in February, worth £586m more than the same month in 2023.
The battle between supermarkets’ own label lines and brands also remains fierce. Own label nipped ahead this month, growing sales by 5.5% versus branded products at 5.3%.
Lidl was the only retailer to achieve double-digit growth with sales up by 10.9% over the 12 weeks to 18 February 2024, making it the fastest-growing grocer for the sixth month running. Fellow discounter Aldi also grew ahead of the market, boosting sales by 5.7% and maintaining its 9.4% share. Sainsbury’s was the fastest-growing of the mults, up 7.6%, with Tesco up 6.2%. Morrisons up 3.1% and Asda 1.9%. Waitrose grew by 3.8% in the period, with Iceland and Co-op up 2.1% and 1.4% respectively.
Grocery inflation now stands at 6.1% for the 12-week period ending 18 February 2024. Prices are rising fastest in markets such as sugar, confectionery, chocolate confectionery and frozenpotato products, and are falling fastest in butter, milk and toilet tissue.