Food price rises slow but 'dark clouds on horizon' - what's falling at what's at risk?
Prices rose 6.9% in the year to August, down from 8.4% last month.
Non-food inflation remained unchanged at 4.7% in August, but it's the cost of food that made the difference, analysis by the British Retail Consortium suggests.
Food inflation has dropped from 13.4% in July to 11.5% in August - the fourth consecutive month of deceleration.
Meat, potatoes and some cooking oils helped fuel the change. Fresh food overall dropped from 14.3% to 11.6%.
Toiletries and cosmetics also eased in price, although inflation for clothing and footwear increased as summer sales came to an end.
Inflation would have dropped further if the Government hadn't increased alcohol duties in August, the BRC said.
Ukraine grain crisis
However, there could be trouble ahead as Ukraine's grain exports are in jeopardy again.
Ukraine exports almost a third of the world's grain. It exports 45% of the world's sunflower oil and is the third largest producer of corn, barley and rapeseed.
Not only are its exports essential as food for people, particularly in developing countries, but also as feed for animals. Any disruption to the export of grain will increase food prices.
Russia blocked exports of Ukrainian grain last year at the beginning of its invasion into the country, before the Black Sea Grain Initiative agreement was secured.
However Russia pulled out of the deal last month.
India has also placed export restrictions on rice.
Both factors mean there are "dark clouds on the horizon", according to the BRC.
Helen Dickinson OBE, chief executive of the BRC, said: “While inflation is on course to continue to fall thanks to retailers’ efforts, there are supply chain risks for retailers to navigate.
“Russia’s withdrawal from the Black Sea Grain Initiative and its targeting of Ukrainian grain facilities, as well as poor harvests across Europe and beyond, could serve as potential roadblocks to lower inflation.
“A potential £400m hike to business rates bills from next April would certainly jeopardise efforts to tackle inflation unless the Chancellor intervenes.”
About 60 percent of households expect to be severely or moderately impacted by rising household costs as winter approaches, according to research by NielsenIQ.
Mike Watkins, head of retailer and business insight at NielsenIQ said: "Once back from summer holidays, we expect consumers to remain cautious about discretionary spend even as inflation decelerates.”
The warnings come as it emerged shoppers' trust in supermarkets is now the lowest it's been since the horsemeat scandal when horse DNA was found in frozen beef products.
A trust score of 30 was given on consumer watchdog Which?'s scale which ranges from -100 to 100.
It hasn't been so low since February 2013 when a score of 24 was recorded after the horsemeat scandal.
Only 48 percent of 2,000 customers surveyed said they trusted supermarkets to act in their best interest, while 18 percent said they don't trust supermarkets at all.
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