The British Retail Consortium (BRC) has highlighted that retailers are facing “significant cost pressures” as energy bills rise.
Looking at the 1st-7th May 2026 period, shop price inflation increased to 1.2% year-on-year in May, against growth of 1% in April. BRC said this was above the 3-month average of 1.1%.
Food inflation decreased to 2.7% on the year in May, against growth of 3.1% in April and below the 3-month average of 3.1%.
Fresh food inflation decreased to 3.4% on the year in May, while ambient food inflation decreased to 1.6% year-on-year in May. This was against growth of 3.9% and 2.1% respectively in April.
“To help protect households, Government should take action to reduce business costs.”
Helen Dickinson, chief executive of the BRC, commented: “While retailers work hard to keep prices down for customers, they continue to face significant cost pressures, including higher energy bills and disruption linked to the conflict in Iran. Businesses cannot absorb these costs indefinitely, which risks pushing prices higher in the months ahead.
“To help protect households, Government should take action to reduce business costs. Reducing the non-commodity charges, taxes and levies that make up more than two-thirds of energy bills, and cutting red tape would help keep inflation down.”
Mike Watkins, head of retailer and business insight at Nielsen IQ, stated: “Food inflation is still around the same level as a year ago, helped by supermarkets maintaining promotions after Easter, but prices are now starting to creep up for non-food after a period of deflation. With external inflationary pressure building and many households cautious about spending, we can expect promotions across all of retail to increase over the summer months.”
