Annual shop prices inflation is at its lowest level since June 2022, a survey suggested yesterday.

Shop prices in early November were 4.3 per cent higher than they had been a year earlier, down from the 5.2 per cent inflation reported in October and from the peak of 9 per cent inflation ­recorded in May, ­according to the latest data from the British Retail Consortium and NielsenIQ.

Food prices inflation fell to 7.8 per cent, down from 8.8 per cent in October and marking the seventh consecutive month of ­decline. Food prices inflation is now less than half its peak rate of 15.7 per cent, recorded in April 2023, and is the lowest since July 2022.

Non-food inflation fell to 2.5 per cent in November from 3.4 per cent in October, continuing a downward trajectory from a peak of 5.8 per cent in May.

However, looming cost pressures threaten to push inflation back up again next year, the retail consortium warned. Helen Dickinson, chief executive of the trade body, said that retailers faced “new headwinds in 2024, from government-imposed increases in business rates bills to the hidden costs of complying with new regulations. Combining these with the biggest rise to the national living wage on record will likely stall or even reverse progress made thus far on bringing down inflation, particularly in food.”

The consortium’s figures, based on information for the first week of ­November, show that inflation ­was steeper for “ambient foods” — those stored at room temperature, such as tins — at 9.2 per cent than it did for fresh foods, where inflation fell to 6.7 per cent. Dickinson said this reflected a larger proportion of ambient foods being imported and ­affected by the weak pound, whereas lower energy prices had cut input costs for fresh dairy products, in particular.

She said the wider fall in inflation reflected retailers competing “fiercely to bring prices down for customers ahead of Christmas”, but “while health and beauty products saw price cuts as retailers rush to shift stock before Christmas, clothing prices increased as some retailers continued to hold off on promotional activity”.