British consumers received some relief to pressure on their budgets in January as a step-up in supermarket promotions meant grocery inflation edged lower following four straight months of rises, according to industry data.

Market researcher Kantar said annual grocery price inflation was 3.3 per cent in the four weeks to Jan. 26, down from 3.7 per cent in last month’s report. Sales rose 4.3 per cent over the period year-on-year.

It said the fall in inflation reflected an increased level of January promotions from supermarkets. They rose year-on-year by 274 million pounds ($340 million), accounting for 27.2 per cent of sales – the highest level in January since 2021.

Kantar said prices are rising fastest in products such as chocolate confectionery, chilled smoothies and juices and butters and spreads, and are falling fastest in cooking sauces, household paper products and cat food.

Despite the January fall in food inflation, supermarkets have warned that tax rises in the new Labour government’s first budget in October, together with another rise in the national minimum wage, will be inflationary.

Prominent grocery industry researcher, the Institute of Grocery Distribution has forecast that food inflation could hit nearly 4.9 per cent in 2025.