Harvir Dhillon

Full report is available here ⤵️

Real wage growth remains positive, but inflation has eroded growth down to ~1%. Housing and utility costs (as well as grocery bills) continue to put pressure on household budgets. Shoppers are staying savvy, using loyalty schemes and promotions to maximise savings. 🛒

🌍 Global commodity markets remain turbulent. Cocoa and coffee prices remain elevated, and tea and oil-based goods are also seeing persistent upward pressure. Meanwhile, global oil prices dipped slightly but remain volatile.

Non-food deflation eased to -1.0%, but monthly prices nudged up in several discretionary categories. Clothing and furniture saw price decreases, while books, stationery & home entertainment continued to increase. 🏷️

🍏 Food inflation accelerated to 4.0%, the strongest rate since early 2024:

Fresh food inflation remained unchanged at 3.2%, driven by price rises in meat, fish, and dairy.

Ambient food surged to 5.1%, led by oils, cereals, and hot beverages.

Headline shop price inflation rose to 0.7% year-on-year, the second consecutive month of inflation, and the highest since May 2023. Month-on-month, prices increased by 0.2%. 📊

🛍️📈 Retail Prices Tick Higher in July

Today we published the latest @britishretail.bsky.social – NielsenIQ Shop Price Monitor, covering July 2025.

Thanks Euan!

💷 But margins are still under strain. Retailers are juggling higher wage bills, energy costs and upcoming packaging levies. Shopper confidence dipped again, and most growth is still coming via value, not volume.

🎮The Nintendo Switch 2 had another bumper month as demand outpaced supply for a third month running. Fans, consoles and fragrance topped the gifting charts.

🧳In-store non-food rose 2.2% YoY, recovering from a tough May. Categories like computing and homeware benefited from better weather and pre-holiday shopping.

📦Online non-food sales rose 2.3%, holding above trend. Strongest performers: household appliances, health & beauty, and furniture. Online share held steady at 36.6% of non-food sales.

👟Non-food rose 2.2% YoY, a rebound from May’s 1.1% fall. Sales of electric fans and leisure kit spiked as the heat kicked in. Furniture, household appliances and clothing also saw a lift, though fashion remains patchy.

☀️Food sales jumped 4.1% YoY, up from 3.6% in May. Higher prices played a role, but summer BBQs and sports events helped. Cold drinks, snacks and seasonal staples saw solid demand.

🛍️📈 Warm weather lifts June retail sales

Retail sales rose 3.1% YoY in June, helped by soaring temperatures and early holiday prep. It’s the strongest June since 2021, but volumes remain under pressure as growth was again propped up by food inflation.

Are we set to see a bit of a repeat of GDP performance in 2024? The rollercoaster ride is heading downwards right now. 🎢

📆 Looking ahead, our expectation is that food inflation will continue to firm over the summer, while non-food deflation gradually fades. Whether this tips into broader inflation will depend on how global commodity prices and domestic operating costs evolve.

While real wages are rising at 1.5%, housing and utility bills continue to weigh on discretionary spending. Shoppers are staying savvy, taking advantage of promotions, loyalty schemes, with value ranges remaining key battlegrounds for retailers. 🛒

🌍 Global commodity price pressures remain volatile. Oil prices spiked mid-month, then fell sharply. Food commodities like cocoa, olive oil and coffee remain elevated. Metals prices surged, adding to supply chain strain.

Non-food deflation continued to fade, easing to -1.2% from -1.5% in May. Prices rose month-on-month across clothing, books and household categories, though electricals and DIY saw further reductions. Home entertainment also dipped again. 🏷️

🍏 Food inflation strengthened for a fifth straight month, hitting 3.7%, the highest rate since late 2023. Within this, fresh food inflation surged to 3.2%, with meat, fish, and bakery items all posting steep monthly increases. Ambient inflation hit 4.3%.

Headline shop price inflation turned positive for the first time since July 2024, rising 0.4% year-on-year. Prices also rose 0.3% on the month. 📊

🛍️📈 Retail inflation positive for the first time in a year

Today we published the latest @britishretail.bsky.social - NIQ Shop Price Monitor, covering June.

Real disposable income per head falls for the first time in over a year

woody and buzz lightyear from the movie toy story are standing next to each other on a wooden floor . ALT: woody and buzz lightyear from the movie toy story are standing next to each other on a wooden floor .

Em-dashes, em-dashes everywhere

Been looking at previously published Retail Sales Index data, going back a few years. Two things stand out: big upward revisions to 2001/02 figures, and more recently (2024/25) adjustments have tended to be downwards.

👀

East Midlands 😢

The effect of an ever-increasing business rates burden is to further empty high streets. 📉

They haven't incorporated the scanner data yet, so goes some way to explaining why the ONS' number is higher (we don't have this either, but account for e.g. 2-for-1 promotions/multi-buy). So that alone SPI/Kantar probably give a better indication as to "experienced" food inflation.