Shop price inflation edged higher in December as food prices accelerated in the run-up to Christmas, according to the latest figures from the British Retail Consortium (BRC).
Covering the period 1–7 December 2025, overall shop price inflation rose to 0.7 per cent year on year, up from 0.6 per cent in November and in line with the three-month average of 0.7 per cent.
The increase was driven by food inflation, which climbed to 3.3 per cent year on year in December, compared with 3.0 per cent the previous month. Fresh food inflation rose to 3.8 per cent, up from 3.6 per cent in November, while ambient food inflation increased to 2.5 per cent, compared with 2.4 per cent previously. Both fresh and ambient categories, however, remained slightly below their respective three-month averages.
Non-food prices continued to provide deflationary pressure, with non-food inflation steady at -0.6 per cent year on year in December, unchanged from November and in line with the three-month average.
Helen Dickinson, chief executive of the BRC, said shop price inflation edged up as food prices rose at a faster pace, but highlighted that shoppers were still able to find value over the festive period.
“Nonetheless, shoppers still found plenty of value across many Christmas essentials including vegetables, cheeses, and alcohol, helping households to enjoy the festive season,” Dickinson said. She added that promotions were widespread across popular gifting categories such as toys, books and home entertainment.
Looking ahead, Dickinson warned that while falling energy prices and improved crop supply should help ease some cost pressures, inflation is likely to remain “sticky” due to rising public policy costs and regulation.
“2026 must be the year that Government works with business to create a policy environment that reduces the pressures bearing down on the industry. This will enable retailers to invest more in keeping their prices down, benefitting households all across the country,” she said.
Commenting on shopper behaviour, Mike Watkins, head of retailer and business insight at NIQ, said consumers remained cautious over Christmas, with affordability front of mind.
“Retailers worked hard to encourage spending by keeping supply chain price increases to a minimum, and many food retailers reduced prices in December to support demand,” Watkins said. He added that while inflation has peaked, weak shopper sentiment is expected to persist into 2026, with consumers continuing to seek out lower prices and promotional offers.