Shop Price Inflation Climbs as Non Food Costs Surge in September 2025

The pace of shop price inflation accelerated during September, driven primarily by increased costs for non-food items such as DIY and gardening products, according to new data from the British Retail Consortium and NielsenIQ. The survey, published on Tuesday, shows a year-on-year shop price inflation rate of 1.4 percent, a notable rise from the 0.9 percent recorded in August and surpassing the recent three-month average of 1 percent.

Non-food prices rose by 0.3 percent over the past four weeks, buoyed by heightened demand for gardening and home improvement goods during the warm summer months. In contrast, prices in some back-to-school sectors, including laptops, dipped at the commencement of the new academic year. Over the full year, non-food prices fell by 0.1 percent, though the rate of yearly disinflation eased considerably from a drop of 0.8 percent in August.

Food inflation remained steady at 4.2 percent for the first time in seven months. Despite this stability, food prices are still elevated, and the industry continues to grapple with higher labour and energy costs, exacerbated by the government’s £25 billion national insurance measures impacting the corporate sector. This sustained pressure is particularly evident in persistently high dairy and beef prices. The Office for National Statistics’ official measure reported food inflation at 5.1 percent in August, marking a nineteen-month high.

There is growing concern among Bank of England officials that stubbornly high grocery prices could trigger inflation across other sectors of the economy. Retail Consortium chief executive Helen Dickinson commented that a prolonged period of non-food price declines now appears to be ending, with inflationary pressures spreading beyond food items.

Consumer price sensitivity is increasing, according to NielsenIQ’s Mike Watkins, as households feel the impact of higher shop bills. Retailers have also reported substantial market value losses, heightening pressure on policymakers ahead of the government’s November budget. Lord Wolfson of Aspley Guise, chief executive of Next and a Conservative peer, warned that current fiscal strategies might result in years of sluggish growth, suggesting an unfavourable medium-to-long-term outlook for the UK economy.