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UK food price inflation slows to 6.7%, data shows
UK grocery price inflation slowed to an annual rate of 6.7% in December, while retailers enjoyed their busiest Christmas since 2019, according to data firm Kantar.
Inflation is currently at its lowest level since April 2022, but many consumers are still feeling the pinch. Prices of sweets, eggs and frozen potato products rose fastest, while prices of dairy products such as butter, milk and cream fell.
Fraser McKevittKantar’s Head of Retail and Consumer Insights said:
Inflation rates are falling at the fastest rate ever recorded, but consumers still face considerable budget pressure. It’s clear that retailers are working hard to offer the best value and win over shoppers over the Christmas period, and promotions have been at the heart of their strategies. Nearly a third of the money spent in the four weeks to Christmas Eve was on products with some kind of offer, the highest level since December 2020 and an increase of £823m on last year. ”
Brits made 488 million supermarket purchases in the four weeks to December 24, 12 million more than a year earlier and the most at Christmas since before the pandemic. A record £13.7bn was paid out last month, with the average household spending a record £477.
discount chain aldi and riddle Britain’s two biggest supermarkets record record market share over the Christmas period. tesco and sainsbury’swhich also included Christmas winners.
In the 12 weeks to December 24, Lidl’s sales rose 13.8% year-on-year, while Aldis’s sales rose 9.9%, giving the companies a combined market share of 17%. Sainsbury’s sales increased by 9.3% and Tesco’s sales increased by 7.5%.
Shoppers spent £13.7bn on groceries in the run-up to Christmas, 7% more than a year ago, as they looked for bargains and switched to discounters to offset rising prices.
Fraser McKevitt explained:
As expected, Christmas this year was amazing. Friday 22nd December was the most popular shopping day, with over 25 million trips made and consumers spending his £803 million in stores. This is an 85% increase over his 2023 Friday average. Online market share remained stable at 11.6%. , almost 1 in 5 households received his delivery on the big day.
important events
Introduction: Red Sea attack could lead to price rises, UK retail executives say. FTSE 100 index reaches 40
good morning. Welcome to our regular coverage of business, financial markets and the global economy.
British retail giants have warned that Houthi rebel attacks on commercial ships in the Red Sea have delayed shipments, impacting product availability and potentially increasing prices in the UK. Maersk and other major shipping companies are diverting ships. They have now memorized much longer times to circumnavigate Africa’s Cape of Good Hope and climb up the western side of Africa.
of British Retail Consortium It warned that this could have a knock-on effect on product availability and pricing.chief executive officer helen dickinson The company said this was “as a result of increased shipping and freight insurance costs.” She added:
Over the next few months, some items will take longer to ship.
Leeds based boxer gifts It designs games and seasonal presents, which are manufactured in China and shipped to Europe via the Red Sea, one of the world’s busiest shipping routes. thomas obrienThe boss of the family-run business told the BBC that some costs had risen by 250% in the past two weeks.
Since COVID-19, we have pretty much gotten used to our packages arriving on time, but at the moment due to the Red Sea, packages are taking an extra 10-14 days to arrive.
In the end, there will be a delay of 2-3 weeks. We have Valentine’s Day products for those who are late and are likely to miss out on Valentine’s Day.
The same impact will be felt on Mother’s Day, and a large portion of the sales window for these games will be lost.
Oil prices are stable this morningBrent crude oil is trading at $75.88 per barrel and US light crude oil is trading at $70.3 per barrel.
marine stewardship council (MSC) and maersk France has suspended navigation through the Red Sea until further notice. CMA-CGM Shipping between Europe and the Mediterranean is increasing.
On a more positive note, the FTSE 100 turns 40 today. Yesterday, the stock started the year down 0.15%. Our financial editor Nils Pratley has explored the ups and downs of the past 40 years.
Yesterday, the first trading day of the new year, many stock markets that had made big gains in recent weeks fell. Traders are reassessing prospects for rate cuts: Markets were pricing in a 2024 U.S. interest rate cut of up to 160 basis points, double the Federal Reserve’s plan, but are now pricing in less than 150 basis points.
As Deutsche Bank analysts pointed out, expectations that the Fed will cut rates by March are back to 85%, and similarly the European Central Bank now sees a 59% chance of cutting rates by March. This is down from 71% last Thursday. . Minutes from the previous meeting, released later today, should shed further light on the Fed’s thinking.
On Wall Street yesterday, the S&P 500 index closed down 0.6%, while the Nasdaq was down even more by 1.6%. Asian stocks fell overnight, with Japan’s Nikkei 225 down 0.2%, Hong Kong’s Hang Seng down 0.9%, the Australian market down 1.4% and the South Korean market down 2.3%.
In 2023, global financial markets disrupted gloomy expectations as stock prices rose and bonds recovered the hefty losses they incurred earlier in the year. Many major stock indexes posted double-digit gains as falling inflation raised expectations for interest rate cuts next year and recession fears receded, at least in the United States. But Britain’s FTSE 100 index has lagged, rising less than 4% last year.
agenda
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8:55am (GMT): Germany’s December unemployment rate (forecast: 5.9%)
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3pm GMT: US ISM Manufacturing PMI for December (Forecast: 47.1)
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7:00 PM GMT: Minutes of the last meeting of the U.S. Federal Reserve Open Market Committee.
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