Shoppers were hit with an unexpected rise in grocery inflation last month, ending four consecutive months of easing price pressures.
Food price inflation climbed to 4.3% in the four weeks to 22 February, up from 4% in January. That followed a steady fall from 4.7% in December, according to market research firm Worldpanel by Numerator. The increase is another setback for households already managing tight budgets amid the ongoing cost-of-living squeeze.
Economists have warned that inflationary pressures could intensify if conflict in the Middle East continues. The European Central Bank’s chief economist said a prolonged war could disrupt oil and gas supplies, leading to a substantial spike in inflation and a sharp slowdown in eurozone output. Energy markets have already reacted, with oil and gas prices rising sharply. For UK consumers, that raises the prospect of higher fuel costs and increased household energy bills in the months ahead.
Shopping habits are also shifting. Online grocery sales rose 9.7% year on year, with more than 18 million orders placed over the same four-week period. Internet purchases now account for 13% of total grocery spending – the highest proportion since July 2021.
Ocado remained the fastest-growing supermarket over the 12 weeks to 22 February, reporting sales growth of 15.1% and securing a 2.1% market share. Lidl also continued its strong performance, recording double-digit sales growth for the twelfth consecutive month. Sales at the discounter rose 10%, giving it a 7.8% market share.
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