Period Covered: 01 – 07 December
2021
- Shop Price annual inflation accelerated to 0.8% in December,
up from 0.3% in November. This is above the 12- and 6-month
average price decreases of 0.9% and 0.3%, respectively. Following
November’s rise, this is the second time that prices have risen
since May 2019.
- Non-Food deflation accelerated to 0.2% in December compared
to the decline of 0.1% in November. This is a slower rate of
decline than the 12- and 6-month average price declines of 1.7%
and 0.9%, respectively.
- Food inflation accelerated to 2.4% in December, up from 1.1%
in November. This is above the 12- and 6-month average price
growth rates of 0.3% and 0.6%, respectively. This is the highest
inflation rate since March 2019.
- Fresh Food inflation accelerated significantly in December to
3.0%, up from 1.2% in November. This is above the 12- and 6-month
average price growth rates of -0.2% and 0.5%, respectively. This
is the highest inflation rate since April 2013.
- Ambient Food inflation accelerated to 1.7% in December, up
from 0.9% in November. This is above the 12- and 6-month average
price increases of 1.0% and 0.9%, respectively. This is the
highest rate of increase since March 2021.
Helen Dickinson OBE, Chief Executive of the British
Retail Consortium, said:
“Consumers may have noticed that their Christmas shop became a
little more expensive in December. Not only did prices rise, but
did so at a faster rate, especially in food. Food prices
were falling earlier on in 2021, but the acute labour shortages
across supply chains, amongst other factors, led to the year
ending with a notable increase; for example, fresh food saw the
largest rate of inflation in almost a decade. Year-on-year
non-food products were deflationary, but prices rose across the
board on the previous month.
“The trajectory for consumer prices is very clear: they will
continue to rise, and at a faster rate. Retailers can no longer
absorb all the cost pressures arising from more expensive
transportation, labour shortages, and rising commodity and global
food prices. Consumers will already be harder pressed this year,
with rising energy bills, the looming hike in national insurance,
and more expensive mortgages. Government should relieve some of
these costs by looking for long-term solutions for resolvable
issues such as labour shortages.”
Mike Watkins, Head of Retailer and Business Insight,
NielsenIQ, said:
“After a challenging Christmas
period, consumers are facing higher energy, travel and for some
mortgage costs and the underlying price inflation in retail
may only make it more difficult to entice shoppers to spend in
January. But it is weak consumer confidence and uncertainty
around the pandemic rather than shop price inflation which will
have the biggest impact on demand at the start of the year”.
