By James Davey
LONDON (Reuters) - British grocery inflation eased slightly for the third month in a row in June, industry data showed on Tuesday, providing a modicum of comfort for consumers worn down by a cost of living crisis into its second year.
Market researcher Kantar said annual grocery inflation was 16.5% in the four weeks to June 11, down from 17.2% in its May data set.
It said prices rose fastest for products such as eggs, cooking sauces and frozen potatoes.
Prime Minister Rishi Sunak's key pledge to halve inflation in 2023 has been undermined by persistently high food inflation.
Any signs that it is abating or could even reverse in the coming months are being closely watched by the Bank of England, lawmakers and cash-strapped consumers.
“This is the lowest rate of grocery price inflation we’ve seen in 2023, which will be a relief to shoppers and retailers," said Fraser McKevitt, head of retail and consumer insight at Kantar, noting it was still the sixth-highest monthly figure in the past 15 years.
"Price rises are now being compared to the increasing rate of grocery inflation seen last summer, which means that it should continue to fall in the coming months," he said.
Market leader Tesco (LON:TSCO) said on Friday food inflation was starting to ease and it was hopeful it would moderate through the year. It and most other major grocers have cut the prices of some products in recent weeks.
UK households are changing their behaviour to cut costs. Many are cutting back, trading down to the cheapest own label products, preparing simpler dishes with fewer ingredients and increasingly using microwaves.
The Kantar data for June provides the most up to date snapshot of UK grocery inflation.
Official data for overall UK inflation in May will be published on Wednesday. It was running at 8.7% in April, with the measure for food and drink at 19.1%.
Kantar said grocery sales rose by 10.8% over the four weeks year-on-year, driven by price rises.
Over the 12 weeks to June 11, discounters Aldi and Lidl were again Britain's fastest growing grocers.
UK grocers' market share and sales growth (%)
Market share Market share % change in
12 wks to 12 wks to sales
June 11 2023 June 12 2022 (yr-on-yr)
Tesco 27.1 27.3 8.9
Sainsbury's 14.9 14.9 10.0
Asda 13.7 13.7 10.0
Aldi 10.2 9.0 24.6
Morrisons 8.8 9.6 0.8
Lidl 7.7 6.9 23.2
Co-operative 5.8 6.2 3.8
Waitrose 4.5 4.8 3.3
Iceland 2.3 2.3 8.9
Ocado (LON:OCDO) 1.7 1.8 2.5
Source: Kantar
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