The rate of grocery inflation in the 12 weeks to 1 September held at 2.8%, the same level as reported in July, but 8.5 percentage points below what was seen a year ago.

The data, contained in the latest Kantar Irish grocery market report, shows that while the pace of price rises in the economy have moderated this year, the cost of grocery shopping continues to creep higher.

Shoppers are still favouring supermarket own-label products, with the sector holding a value share of 47% of all items added to shopping trolleys over the last four weeks.

Consumers are still spending on branded products, but, in that sector, over 60% of purchases were on some form of promotion.

This implies that makers of branded products are having to offer discounts in order to gain market share.

Wider picture

Looking at the wider inflation picture, the Central Statistics Office reported last week that the consumer price index rose by 1.7% in August from a year earlier.

This wider measure of price changes in the economy includes energy prices, which have fallen by almost 10% over the last 12 months.

If energy is excluded from that index, then it gives an annual inflation reading of 2.9%, which is in line with the Kantar data.

Last week the European Central Bank reduced interest rates as policymakers there feel that inflation will continue its recent downward trajectory. The bank forecasts that price rises will be close to or just below 2%, on average, in 2025 and 2026.