The British Retail Consortium (BRC) has said it expects food inflation to remain steady in the medium-term.

It comes as the rate of inflation remained unchanged in March, at 3.5%, while overall shop price inflation rose to 1.4% during the month, in comparison to 1.1% in February.

Helen Dickinson, director general of the BRC, said: “Food inflation is unchanged since February, but this is primarily due to a decrease in prices for tinned and packet goods balancing out a fresh food rise. There are still price pressures, which will continue to work through, but I would expect food inflation to remain fairly steady in the medium term.

“Total inflation is at its highest rate since December, again reflecting that many retailers went into the New Year with less stock to clear, so discounting is less extensive compared with 2012.”

Mike Watkins, head of retailer and business insight, Nielsen said: “With cold weather in March holding back spending across many channels, price reductions have been needed to stimulate demand for food and there was also an increase in price competition at the supermarkets due to Easter promotions, keeping overall food inflation stable.

“As discretionary spend for the next few months is expected to remain flat at best, what upward pressure there is on prices is not coming from the consumer at the moment.”

Last October, food inflation rose to 4%, a 0.9% rise on the previous month when the rate was at a two-year low. The BRC said it had been affected by poor harvests, rising production costs and commodity price increases.