Fuel prices help to bring down overall inflation
OVERALL inflation has, unexpectedly, continued to fall downwards according to the latest date from the Office for National Statistics (ONS).
Covering the year to the end of March 2025, the consumer price index including owner occupiers’ housing costs (CPIH) rose by 3.4%, down from the figure at the end of February when it sat at 3.7%.
The largest downward contributions to the monthly change in CPIH came from Motor Fuels as well as Recreation and Culture, with a further large decrease coming from housing and household services.
Between the end of February to the end of March, overall transport costs fell by 0.6% to sit at 1.2%, with this decrease largely coming from a fall in the average price of petrol
According to the ONS, the average price of petrol fell by 1.6 pence per litre (ppl) between February and March to stand at an average 137.5ppl. This marks a notable change from March 2024 when the number stood at an average 144.8ppl.
Diesel prices also fell by 1.6ppl in March 2025 to stand at an average of 144.8ppl. Overall, these movements resulted in motor fuel prices falling by 5.3% in the 12 months to March 2025.
Both the Food and Non-Alcoholic Beverages and Alcohol and Tobacco categories experienced a fall between February and March as well. Food and Non-Alc fell by 0.3% to sit at 3% and Alcohol and Tobacco fell by 0.4% to sit at 5.3%.
Across Food and Non-Alc, there were some small downward effects from confectionery, where prices fell this year but rose in 2024, though this was partially offset by a small upward effect from milk, cheese and eggs.
Though this slight ease for inflation could be offset by the the time the April figures are released next month, says the British Retail Consortium (BRC).
Kris Hamer, director of insight at the BRC, said: “The slight easing in inflation in March will prove to be largely insignificant once the figures for April are released next month.
“Not only will many feel the pinch of rising household bills, but the impact of higher employer National Insurance and NLW could begin to filter through into consumer prices.
“To protect households, it is essential the government limits the burden on the industry in other areas, ensuring no shop pays more as a result of the upcoming business rates reform.”
Even with general positive signs from the ONS, Scottish consumers still remain cautious with their shops. The latest Scottish data from Kantar highlighted that take-home grocery sales in Scotland only rose by 2% in the four weeks to 23 March.
Beyond this, shoppers have also been slow to hop on to seasonal sales this year as Kantar said there was a noticeable lack in demand for Easter treats and spring-cleaning products during the four week period.
Lesley-Ann Gray, strategic insight director at Kantar, said: “Compared to the same time period last year, traditional Easter eggs saw a sharp decline of 54.4%, while hot cross buns dropped by 39.4% in pack sales.
“Sales of household cleaning products also fell by 4.8%, suggesting a delayed seasonal shift.”
And Scottish consumers are still seeking the best deals they can get, with sales activity across promotions noticeably and own-label options continue to outperform branded products.
Gray said: “Promotional activity overall saw a notable uplift, with 5% more sales on promotion this year compared to the same period last year. Tesco led the way, with 37% of its sales driven by promotions—well above the market average of 26.4%.
“Own-label ranges continued to slightly outperform branded products, growing by 3.11% compared to 3.05% for the latter.
“Premium ranges, such as Tesco Finest and Sainsbury’s Taste the Difference, were key contributors, with 15.6% of Sainsbury’s own-label sales coming from premium lines over the four-week period.”
