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UK CPI for September 2025 declined to 3.8% YoY, falling below market expectations of 4.0% (vs. Turnleaf estimate of 3.94%). The decline was primarily driven by sustained lower food prices from August 2025 and reduced costs in the culture and recreation category. Notably, September 2025 marks the first monthly food price decrease since May 2024.

Food Price Dynamics and Policy Considerations

The food price decline warrants careful interpretation given impending policy changes. On October 1, 2025, the multibuy promotion ban came into effect, restricting volume-based promotions on products high in fat, salt, and sugar (HFSS). Additionally, the Extended Producer Responsibility (EPR) scheme began in October 2025, requiring retailers and manufacturers to cover household packaging costs, a policy distinct from the Plastic Packaging Tax increase that took effect in April 2025.

While anticipatory discounting ahead of the multibuy ban may have contributed to September’s decline, the data reveals differentiated trends across food categories. Unprocessed foods, representing 4.7% of the CPI basket, fell from 4.3% to 3.7% YoY, while processed foods, representing 6.5% of the CPI basket, declined from 5.7% to 5.2% YoY. The ONS noted that sales and discounting increased at a greater rate into September 2025 compared to September 2024, which may partially explain these movements.

Meat prices merit attention. Global supply shortages have driven meat prices higher internationally and contributed to elevated dairy costs through higher feed expenses. Our Red Meat proxy basket indicated flat pricing with no continued increases, suggesting subdued meat price pressure going forward (Figure 1). This leaves other elevated food products, particularly fish, as important potential drivers of further disinflation.

Figure 1

Given the October 1 implementation of the multibuy ban and the broader inflationary pressures from the EPR scheme, we remain skeptical that this food price decline will be sustained. Should downward pressure continue beyond October, it would likely reflect easing supply constraints, specifically, improved weather conditions and the resolution of global meat supply contractions.

The ONS recently announced plans to enhance price data collection by directly incorporating supermarket scanner data, covering approximately 300 million price points from sales of over a billion units per month across 50% of the groceries market. This methodology, expected to be implemented in March 2026, will directly capture store card discounts and should mitigate future biases introduced by promotional activity.

The culture and recreation category also contributed to the softer CPI print, with the ONS citing lower live music costs as a key factor. Availability for this category is scarce, hence the surprise. This component was the primary driver of both Core CPI and RPI movements.

Service prices, which have remained persistent over recent years, continue to be an important inflation driver in the UK. Elevated wages and robust employment have kept this component elevated, though emerging evidence of labor market cooling, manifested in lower vacancy rates, suggests this dynamic may moderate. Employment trends in the coming months will be critical to monitor.

Turnleaf Outlook

Turnleaf will update its UK forecast in the coming days and will also include the newly minted high-frequency UK Meat Index part of our broader food catalogue. We will continue monitoring global supply chain dynamics for key food items such as milk and meat, which have contributed to the lower-than-expected CPI print. Additionally, continued vigilance on wage developments, which drive much of service price inflation, will be crucial to our forward analysis.