Grocery inflation eases as sales spark amid soaring temperatures
By Abigail Townsend
Date: Tuesday 21 Jul 2026
(Sharecast News) - Food inflation slowed to the lowest rate in nearly two years in July, industry data showed on Tuesday.
According to Worldpanel by Numerator, like-for-like grocery inflation was 2.6% in the four weeks to 12 July, with prices rising in unprocessed fish, baby formula and nappies and shampoos, but falling fastest in chilled butter and spreads, cold soft drinks and sugar confectionary.
It is the lowest rate since December 2024, and the fifth consecutive month of easing prices.
However, Fraser McKevitt, head of retail and consumer insight at Worldpanel, cautioned that while easing prices will be "welcome news" for shoppers grappling with the cost of living, "the annual bill tells a fuller story".
"The average household spent £5,530 on groceries over the 12 months to July, up £156 in the same period last year - a reminder that even as the rate of inflation cools, the cumulative cost of the weekly shop keeps climbing," he said.
The slowdown coincided with a 3.3% spike in take-home grocery sales, driven by the hot weather and sporting fixtures including England's progression through the football World Cup. Shoppers made a total of 497m trips over the four-week period, the highest figure since March 2020.
Among individual retailers, discounter Lidl added to its market share, which now stands at 8.5% compared to 8.3% a year previously, while rival Aldi's dipped to 10.8% from 11%.
Morrisons also returned to growth, with sales rising 3.5% over the 12 weeks to 12 July. Sales increased 1.7% at Tesco, the UK's biggest grocer by market share, while closest rival J Sainsbury recorded a 2.8% improvement.
Online-only Ocado saw its market share rise to 2.2% after sales rocketed 14.1%.
Marks & Spencer, which is excluded from the overall data due to its higher mix of clothing and general merchandising, saw grocery-only sales soar 16%, the fastest since 2023.
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