Shop prices across the UK rose faster in October, according to new figures from the British Retail Consortium (BRC). Prices in shops were 2.1% higher than a year earlier, up from a 1.4% annual rise in September and the sharpest increase since February 2024. The figures are based on prices collected between 1 and 7 October.

Food leads the rise

Food leads the rise. Food price inflation reached 2.9% in October, its highest since April and up from 2.5% in September. Within that, ambient food — tinned, dried and long-life goods — rose 3.2%, its highest since September 2025 and up from 2.2% a month earlier, while fresh food inflation was unchanged at 2.6%. Non-food inflation also picked up, rising to 1.7% from 0.8%, its highest since December 2023, with particularly sharp rises reported for furniture, flooring and home improvement goods.

Why retailers say they cannot absorb costs

Why retailers say they cannot absorb costs. The BRC said prices were being pushed up by higher transport and energy costs, alongside increases in employment costs and packaging levies. Its chief executive, Helen Dickinson, said the dam was starting to break on the wave of costs retailers had absorbed over the last two years, and called on Chancellor John Healey to lower retailers' property taxes and employment costs in his first Budget, due on Wednesday 28 October.

The wider inflation picture

The wider inflation picture. The BRC measure covers shop prices only, which is narrower than official consumer price inflation. That broader measure rose to an 11-month high of 3.5% in September, up from 3.1% in August. Bank of England Governor Andrew Bailey has said this month that businesses have so far largely absorbed higher energy costs linked to the US-Iran war, unlike after Russia's invasion of Ukraine in 2022. The Food and Drink Federation trade body now expects food price inflation to peak next year.

Sources: Reuters; Global Banking & Finance Review.