Price rises hit Christmas shopping

 Period Covered: 01 – 05 November 2021

Shop Price annual rose by 0.3% in November compared to October’s decrease of 0.4%. This is a above the 12- and 6-month average price decreases of 1.2% and 0.6%, respectively. This is the first time that prices have risen since May 2019.

• Non-Food deflation slowed to 0.1% in November compared to the decline of 1.0% in October. This is a slower rate of decline than the 12- and 6-month average price declines of 2.0% and 1.0%, respectively. This is the slowest rate of decline since May 2019.
• Food inflation accelerated to 1.1% in November up from 0.5% in October. This is above the 12- and 6-month average price growth rates of 0.1% and 0.1%, respectively. This is the highest inflation rate since November 2020.
• Fresh Food inflation accelerated to 1.2% in November up from 0.3% in October. This is above the 12- and 6-month average price growth rates of -0.6% and -0.2%, respectively. This is the highest inflation rate since August 2019.
• Ambient Food inflation accelerated to 0.9% in November up from 0.8% in October. This is below the 12- month average price increase of 1.1% and above the 6-month average price increase of 0.6%. This is the highest rate of increase since April 2021.

Helen Dickinson OBE, chief executive of the British Retail Consortium, said: “November saw overall year-on-year prices increase for the first time in two and a half years, driven by rising food prices, and non-food deflation slowing. The impact of labour shortages, rising commodity prices and transportation costs have now very clearly taken their hold on consumer prices. With food prices rising, and particularly fresh food – which saw the highest inflation since 2019 – we may find some of our Christmas shopping a little more expensive this year. Food was also affected by a rise in global food costs where certain staples, such as vegetable oil, have doubled in price in the past two years.

“With ongoing labour shortages throughout the supply chain expected to continue for some time, and no signs that rising costs of transport and commodities will subside, we expect the rate of inflation to accelerate over coming months. Retailers are doing all they can to mitigate the impacts for their customers, Government also must play its part and work with industry to find long-term solutions to the labour shortages as this will help to relieve cost pressures and protect the pockets of the British public who are already facing mounting costs from increasing energy prices and the looming rise in national insurance.”

Mike Watkins, head of retailer and business insight, NielsenIQ: “The significant increases in energy and travel costs are adding pressure to household budgets and the remaining weeks of the Golden Quarter could be an uncertain time for shopper spend. NielsenIQ shopper research shows that 4 in 10 households feel that their spending is constrained and whilst inflationary pressures are now coming from both food and non-food, retailers continue to keep hold back increases in shop prices ahead of Christmas.”