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July food prices rise 4%, impacting retail

Consumers are cutting spending as food prices surge in the UK.

July 29, 2025 at 05:00 AM

Rising UK food prices turn cash-strapped shoppers away from high street

Rising food prices diminish consumer spending and impact retailers.

Soaring food prices shift shoppers away from high street

Britain’s high street retailers faced a challenging month in July as food prices surged, particularly for meat and butter. The British Retail Consortium reported a significant 4% increase in food prices from the previous year, an uptick from 3.7% in June. This rise has put a strain on household budgets as staples such as meat saw an astonishing 17% year-on-year hike. Butter's price also rose by 18.2%, impacting overall grocery costs. Additionally, the Confederation of British Industry noted that economic uncertainty led consumers to tighten their spending, resulting in a decrease in retail sales. Although there was a slight improvement from June’s figures, retailers anticipate persistent struggles due to these economic pressures.

Key Takeaways

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Food prices rose 4% in July, indicating rising household pressures.

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Retailers are struggling to entice consumers back to physical stores.

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17% rise in meat prices contributes to household budget strain.

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Economic uncertainty is pushing consumers to save rather than spend.

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Total shop price inflation for non-food items increased to 0.7%.

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Discount prices in fashion and furniture offer some hope for retailers.

"Economic uncertainty continued to weigh on household demand and contributed to sales volumes falling."

Martin Sartorius, CBI principal economist, highlights the impact of economic conditions on consumer behavior.

"The rising price of staple foodstuffs has pushed up overall food price inflation for a sixth consecutive month."

Helen Dickinson from the BRC elaborates on the continued inflation pressure affecting consumers.

The rising food prices and uncertainty create a challenging environment for both consumers and retailers in the UK. Consumers are forced to choose between essential purchases and discretionary spending, leading to reduced foot traffic on the high street. For retailers, this situation not only affects cash flow but also highlights the broader economic concerns that may linger. With consumers shifting towards savings, businesses must find innovative ways to attract shoppers amid a landscape shaped by inflation and persistent economic fears.

Highlights

Less spending means less shopping on the streets.
High street faces a cold summer amid rising food costs.
Consumers tightening wallets puts retailers on edge.
Shoppers are opting to save rather than spend.

Economic challenges threaten retailers

The rising food prices combined with economic uncertainty are creating a challenging landscape for retailers, leading consumers to cut back on spending.

The ongoing rise in food prices may reshape consumer habits long term.

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uk food inflation retail sales consumer behavior economic outlook economy retail food

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