British grocer Sainsbury’s (SBRY.L) lowered prices again, adding to evidence that food inflation will moderate this year and help consumers struggling with a cost of living crisis in its second year.
The UK’s second-largest retailer behind Tesco (TSCO.L) said it would invest 15 million pounds ($19 million) in lowering prices on rice, pasta, and chicken breast fillets.
“We will continue to pass on savings as soon as we see the wholesale price of food fall,” said Sainsbury’s food commercial director Rhian Bartlett.
In Britain, increased inflation, more taxes, and rising mortgage rates are straining household budgets.
Food inflation, 18.3% in May and 16.5% in June has damaged Prime Minister Rishi Sunak’s core economic vow to halve overall inflation in 2023 before a likely 2024 election.
The Bank of England, legislators, and consumers are anxiously monitoring any indications of improvement.
Tesco, Asda, Morrisons, Marks & Spencer (MKS.L), and Waitrose have recently slashed or frozen prices.
However, some, notably the Bank of England, have criticized retailers for not quickly passing on global commodity price drops.
Inflation plagues European governments. The French government got 75 prominent food businesses to drop prices on hundreds of products earlier this month. Hungary’s government-mandated price cutbacks and Sweden’s competition watchdog is investigating profiteering.
The UK government is not considering price restrictions despite concerns over rising food prices.
Britain’s competition watchdog is investigating food prices but hasn’t found any specific issues.
On Tuesday, a parliamentary committee will examine Sainsbury’s Bartlett and other UK supermarket executives.
