Grocery prices remain a challenge for consumers, even as inflation sees a minor dip this month.
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It looks like there’s a glimmer of hope for shoppers this month, as inflation in supermarkets has taken a slight dip. However, the reality remains that grocery prices are still a hefty **5% higher** than they were this time last year.
While that’s a bit of a drop from July’s **5.2%** inflation rate, many consumers are still feeling the pinch as they navigate their weekly shopping trips in a world of rising costs.
Current Inflation Trends
As of **August 10**, the latest data from Worldpanel by Numerator shows a small decline in grocery price inflation.
But let’s be real—this minor decrease doesn’t really lighten the load for shoppers who have been feeling the hit of higher prices for a while now. Fraser McKevitt, head of retail and consumer insight at Worldpanel, put it bluntly: “We’ve seen a marginal drop in grocery price inflation this month, but we’re still well past the point at which price rises really start to bite.”
So, how are these rising costs affecting our shopping habits? McKevitt points out that it’s not just groceries that are getting hit.
Consumers are adjusting their spending across the board, even skipping out on dining out. In fact, foot traffic in casual dining and fast-service restaurants dropped by **6%** in the three months leading up to mid-July **2025** compared to last year. Are we all just eating at home now?
Shifts in Consumer Preferences
Interestingly, while many are cutting back, it seems there’s still a craving for a little indulgence. Sales of branded grocery items have actually risen by **6.1%** this month, while the sales of own-label products only saw a **4.1%** bump. Branded products now account for **46.4%** of total grocery spending, showing that even in tough times, certain treats still hold their ground—think personal care, sweets, and drinks!
And it doesn’t stop there. Premium own-label products have also seen a boost, with a **11.5%** increase in sales. This suggests that while consumers are being cautious, they’re still ready to splurge on items they perceive as offering more value. So, what’s your go-to treat when the budget tightens?
Let’s not forget about the classics! Certain staples remain popular, like frozen fish fingers, which have been bought by more than half of households over the past year. McKevitt noted, “The humble fish finger remains as popular as ever, and nearly one billion were sold in the past year, with more than half of households grabbing a box.” Who doesn’t love a good fish finger sandwich?
In the grocery battlefield, Lidl and Ocado are currently tied as the fastest-growing retailers, both seeing a **10.7%** increase in sales over the past 12 weeks. Tesco isn’t far behind, achieving its largest monthly market share rise since December **2024**, boosting its share by **0.8** percentage points to **28.4%** and showing a **7.4%** year-on-year growth. Impressive, right?
On the flip side, Asda and Co-op are feeling the heat, reporting sales declines of **2.6%** and **3.2%**, respectively. This shift illustrates how different grocery retailers are adapting to the challenges of inflation and changing consumer behaviors. Which supermarket do you trust the most during these times?
As we continue to face these evolving circumstances, it’s essential for both consumers and retailers to keep an eye on pricing trends and market conditions. Finding that delicate balance between sustaining consumer spending and controlling inflation will be crucial in the months ahead. Are you ready for what’s next?
