British consumers are delaying their Christmas shopping as grocery price inflation in the UK hits a new record, according to new research.
According to the latest data from research firm Kantar, four-week grocery price inflation has reached 14.7 percent, the highest since the firm began to record the data in 2008.
The firm said that take-home grocery sales rose by 5.2 percent in the 12 weeks to Oct. 30, 2022, the fastest rate of market growth since April 2021.
Under increased financial pressure, fewer people stocked the cupboards for Christmas in October, preferring to wait until later in the year.
Fraser McKevitt, head of retail and consumer insight at Kantar, said: “This time last year 2 million consumers had already bought their festive Christmas pudding. We’ve seen 32 percent fewer shoppers doing that this time around, suggesting people are not trying to spread the cost of their purchasing—at least not in October.”
This comes after the Bank of England—the UK’s central bank—raised its base interest rate to 3 percent, the highest in 14 years, and said further hikes could be required to tame runaway inflation.
The bank also stated that the UK could be on course for the longest recession since reliable records began in the 1920s.
The country’s GDP could shrink every quarter for two years, with growth only coming back in the middle of 2024.
No Peak in Sight
According to Kantar, the record-breaking grocery inflation may go even higher.
McKevitt said, “Yet again, we have a new record high figure for grocery price inflation and it’s too early right now to call the top.”
He said the new inflation figure means consumers face a £682 ($781) jump in their annual grocery bill if they continue to buy the same items.
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According to the survey, 27 percent of all British households said they are struggling financially, which is double the proportion recorded last November.
“Nine in 10 of this group say higher food and drink prices are a major concern, second only to energy bills, so it’s clear just how much grocery inflation is hitting people’s wallets and adding to their domestic worries,” said McKevitt.
But he expects sales to be boosted by the men’s football World Cup, which will kick off on Nov. 20.
For the first time in nearly 25 years, two British teams—England and Wales—will compete in the World Cup finals, which “should generate a lot of excitement and could boost sales at the tills,” said McKevitt.
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