Intense competition curbs supermarket price hikes
Supermarkets in the UK raised their prices in December from the previous month, however the hike was lower than the previous year due to competition curbing the impact of a Brexit-caused cost inflation, according to mySupermarket.com
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The site’s tracker covers almost 5,000 products across a variety of supermarkets including Tesco, Asda, Aldi, Sainsbury's, Ocado, Lidl and Morrisons.
A basket of 35 commonly bought grocery items cost £83.33 pounds in December up from £83.18 in November. The price rise was driven by items like bananas, grapes and carrots becoming more expensive.
However the basket was still almost 3% cheaper than it was in December 2015 due to the big supermarket chains like Tesco, Asda, Sainsbury’s and Morrisons compete for customers.
Morrisons has kicked off the price war by slashing the prices of 800 of its items at the start of the new year.
Economists and retail experts expect inflation to occur in the UK market after the Brexit vote led to the pound plummeting, making imports more expensive.
"Despite a rise in December, our Groceries Tracker Basket costs less in December compared to January and shows how the highly competitive price wars between retailers has helped protect shoppers from any subsequent rises caused by current affairs," said mySupermarket CEO Gilad Simhony.