Grocery price inflation has risen for the first time since March 2023 as prices settle at a normal level, new figures show.
Kantar data for the four weeks to 4 August show grocery inflation rose to 1.8%, up from 1.6% last month. Take-home sales at the grocers rose by 3.8% in the four weeks compared with a year ago.
“Having reached its lowest rate in almost three years in July, August saw inflation nudge up again slightly,” said Fraser McKevitt, head of retail and consumer insight at Kantar. “While this is noticeable following 17 straight months of falling rates, it actually marks a return to the average levels seen in the five years before the start of the cost-of-living crisis.”
Prices are now rising across 182 product categories, while the cost in 89 others are falling, offering a mixed picture for consumers. But savvy shoppers are still able to take advantage of a wide range of promotions, with spending on deals rising by 15%, compared to static sales of products at their usual price.
With the Euros, Olympics and summer sunshine over the past few weeks, sales of beer, wine, snacks and barbecue food unsurprisingly performed well.
Sainsbury’s on the up
Among the retailers, Sainsbury’s market share has risen by 0.5 percentage points over the 12 weeks to 4 August, compared to the same period last year. That represents its largest year-on-year share gain since July 1997. It was again the fastest-growing of the traditional supermarkets, with sales increasing by 5.2%.
Market leader Tesco maintained its streak of winning share every month since August 2023. Its hold of the market climbed by 0.6 percentage points to 27.6%, while its sales jumped by 4.9%. Asda now has a 12.6% share, while Morrisons’ stake stands at 8.6%.
Discounters Lidl and Aldi both saw sales growth, according to Kantar. Buoyed by a 7.8% boost in sales, Lidl won an extra 0.4 percentage points of the market, taking its share to 8.1%. Aldi’s market share is now 10%.
Meanwhile sales rose by 11.3% at Ocado, continuing its six-month run as the fastest-growing grocer. Its share is up by 0.1 percentage points compared with last year, and now stands at 1.8%.