UK shop price inflation rose to 7.4% in November, pointing to a bleak winter ahead as consumers tighten their purse strings.
According to the British Retail Consortium (BRC) on Wednesday, this was up from 6.6% in October, and above the three-month average rate of 6.5%. It marks another record for shop price inflation since the index began in 2005.
The data covered the period from 1 to 5 November 2022.
Food inflation accelerated sharply to 12.4% during the month, up from 11.6% in October – above the three-month average rate of 11.5%. This was also the highest inflation rate in the food category on record.
Fresh food in particular rose 14.3%, with meat, eggs and dairy amongst the goods most affected thanks to soaring energy prices, and rising costs of animal feed and transport.
Meanwhile, non-food inflation accelerated to 4.8% from 4.1% the month before, and above the 3-month average rate of 4.0%. Inflation remains rose to a fresh series’ high in this category.
Coffee prices shot up compared to the month before, as high input costs filtered through to price tags, while Christmas gifts is also set to become more expensive than in previous years, with sports and recreation equipment seeing particularly high increases.
Watch: How to save money on a low income
“While there are signs that cost pressures, and price rises, might start to ease in 2023, Christmas cheer will be dampened this year as households cut back on seasonal spending in order to prioritise the essentials,” Helen Dickinson, chief executive of the British Retail Consortium, said.
“Retailers continue to do all they can to support their customers and ensure everyone can enjoy the festive season by fixing prices of many essentials, offering discounts to vulnerable groups, raising pay for their own people, and expanding their value ranges.”
Meanwhile, Mike Watkins, head of retail and business insight at NielsenIQ, said: "With prices still rising, the cost of Christmas will be higher this year and shoppers will be managing their budgets more closely than at any time since the start of the cost-of-living crisis.
“Retailers are now responding by offering seasonal savings and price cuts and will be hopeful of an uptick in shopper spend as we move into December."
It comes as UK inflation currently stands at 11.1%, a 41-year high. The Office for National Statistics (ONS) said earlier this month that prices rose between September and October 2022 by as much as they did in the entire year to July 2021.
Watch: How does inflation affect interest rates?