In March, shop price inflation registered at -0.4%, a slight improvement from -0.7% in February, though still below the 3-month average of -0.6%. Non-food items saw inflation decrease to -1.9%, matching the 3-month average, while food inflation rose to 2.4%. Fresh food inflation slightly declined but ambient food prices rose notably by 3.7%. Concerns about future inflation due to rising costs from the Budget and new packaging taxes were highlighted by BRC's Helen Dickinson, who warned that cost increases could persist into the coming months.
Retailers continue to do all they can to protect customers from the cost pressures bearing down on the industry. Prices fell for most non-food categories, which kept year-on-year overall shop prices in deflation, but at a reduced rate compared to February.
Across food, price inflation rose year-on-year, with ambient food seeing the highest increase. For example, alcoholic and non-alcoholic beverages both saw price increases due to changes to duties and the hangover from high global sugar prices.
With retailers bracing for significant extra costs which kick in later this week as a result of the Budget, inflation will likely accelerate in the coming months.
While the number of people reported as financially struggling has fallen from its recent peak, this still accounts for almost a quarter of the population.
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