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Nigel TAYLOR Published
August 31, 2025
It’s bleak for both consumers and retailers. That’s the view of the British Retail Consortium (BRC) as UK shop price inflation rose to its highest level since the records started in 2005, data from latest BRC-Nielsen Shop Price Index shows.
Rising food costs played a significant role in pushing overall shop price inflation up to 5.1% in August from 4.4% in July. At least non-food inflation inched down to 2.9% in August, from 3% in July. However, the latter still remains above the three-month average rate of 2.6%.
Meanwhile, food inflation rose to 9.3% in August, up from 7% in July. This is above the three-month average rate of 7.2% and the highest rate since August 2008. It’s a worrying figure that’s likely to mean consumers diverting cash away from the non-food sector in order to pay for essentials.
Following release of the figures, BRC chief executive Helen Dickinson called on the new Prime Minister “to relieve some of the cost burden bearing down on retailers, like the upcoming increase in business rates, in order to help retailers do more to help their customers. As retailers grapple with growing cost pressures, there is only so much they can shoulder.”
She added: “The rise in shop prices is playing into wider UK inflation, which some analysts are predicting could top 18% in 2025. The situation is bleak for both consumers and retailers, but retail businesses will remain committed to supporting their customers through offering discounts to vulnerable groups, expanding value ranges, fixing prices of essentials, and raising staff pay.”