UK grocery inflation falls to 1.6%, says Kantar

By James Davey

LONDON (Reuters) – UK grocery inflation has slowed this month to its lowest level since September 2021, coinciding with the fastest rise in monthly supermarket shopper numbers so far this year, industry data showed on Tuesday.

Market researcher Kantar said annual grocery price inflation was 1.6% in the four weeks to July 7, versus 2.1% in the previous four-week period.

It said prices were falling fastest for products such as toilet tissues, butter and dog food but still rising for items such as vitamins, minerals and supplements, chilled fruit juices and drinks and deodorants.

Kantar’s data, the most up-to-date snapshot of UK consumer behaviour published since the July 4 election, showed take-home grocery sales increased 2.2% in value terms over the four-week period year-on-year.

Official UK data published last month showed overall British inflation returned to its 2% target for the first time in nearly three years in May. Official data for June will be published on Wednesday and is likely to be a key factor in the Bank of England’s deliberations ahead of its Aug. 1 interest rate meeting.

Kantar highlighted a boost to sales of beer, crisps and snacks from the Euro 2024 soccer championship.

It said Britons made 2% more trips to the supermarket this period than they did one year ago, and with pressure on pockets easing, sales of branded products increased by 3.6%, outpacing own-label items at 2.7%.

Over the 12 weeks to July 7, online supermarket Ocado (LON:) was again the fastest-growing grocer with sales up 10.7% year-on-year, Kantar said.

Market leader Tesco (OTC:) saw growth of 4.6%, hitting a market share of 27.7%, its biggest share gain since November 2021. No. 2 Sainsbury’s saw growth of 4.7%.

Asda was again the laggard, with sales down 5.3%, and it lost 90 basis points of market share year-on-year.

UK supermarkets’ market share and sales growth (%)

Market share Market share % change in

12 wks to 12 wks to sales

July 7 2024 July 9 2023 (yr-on-yr)

Tesco 27.7 27.0 4.6

Sainsbury’s 15.3 14.9 4.7

Asda 12.7 13.6 -5.3

Aldi 10.0 10.2 0.3

Morrisons 8.7 8.7 1.0

Lidl 8.1 7.7 7.8

Co-operative 5.7 6.0 -2.9

Waitrose 4.5 4.4 3.3

Iceland 2.3 2.3 4.1

Ocado 1.8 1.7 10.7

Source: Kantar