Cost pressures feed into UK retail prices

Retail prices are rising as cost pressures feed into consumers' shopping baskets with more to come, industry figures showed.

Food prices rose 0.1% in September from a year earlier - the first rise in six months, the British Retail Consortium said. Price rises were led by ambient food where inflation accelerated to 0.8% from 0.3% a year earlier.

Non-food deflation slowed to 1% in September from a decline of 1.2% in August. The BRC said some items, such as for DIY and gardening, rose at the fastest rate since summer 2018 and furniture and electricals prices are also on the up due to shipping problems and high demand.

Overall prices fell 0.5% in September but this was the slowest rate of decline since January 2020 as price rises filtered into the total. The BRC said rising transport costs, labour shortages, Brexit red tape and higher commodity costs lay behind the increases.

Helen Dickinson, the BRC's chief executive, said: "It is inevitable that prices will continue to rise, but government intervention would minimise the impact on consumers. Supply chains have been put to the test recently, with CO2 and HGV shortages."

The price rises coincide with a shortage of lorry drivers that has caused panic buying at petrol stations and holdups in goods getting to shops. The BRC said the government should allow more heavy goods drivers to arrive from Europe while new drivers are trained.

"Without this, these additional burdens to what is already a precarious trading environment will affect the British consumer and the prices they pay for the goods they want and need," Dickinson said.