Having risen from 6.2% in June, July’s inflation was above the 12- and 6-month average price growth rates of 2.9% and 4.8% respectively.
Furthermore, ambient food inflation accelerated to 5.7% in July, up from 4.8% in June, 2.5% and 3.8% above the 12- and 6-month average price growth rates respectively, according to BRC.
BRC chief executive Helen Dickinson OBE said: "July saw the highest rate of shop price inflation since our index began in 2005, as heightened cost pressures continued to filter through to customers.
“Rising production costs, from the price of animal feed and fertiliser to availability of produce, exacerbated by the war in Ukraine, coupled with exorbitant land transport costs, led food prices to rocket to 7%.”
Dickinson continued some of the biggest price rises were seen in dairy products, including lard, cooking fats and butter, while non-food prices had been hit by rising shipping prices, production costs and continued disruption in China.
This comes as inflation in the food service sector topped 10% for the fourth consecutive month in May, according to data from CGA by NielsonIQ, with all ten of the index’s food and drink categories having recorded year-on-year and quarter-on-quarter inflation during the month.
Dickinson added: "As inflation reaches new heights, retailers are doing all they can to absorb as much of these rising costs as possible and to look for efficiencies in their businesses and supply chain.
“With households enduring a cost-of-living crunch, retailers are expanding their value ranges to offer the widest variety of goods to those most in need, providing discounts to vulnerable groups, and raising staff pay.
“Nevertheless, households and businesses must prepare for a difficult period as inflationary pressures hit home."