Food inflation rose by 2.4% year-on-year in March with ambient food experiencing the highest price increases, according to new data.

The British Retail Consortium (BRC)-NIQ Shop Price Index showed that ambient food inflation increased to 3.7% year-on-year last month, compared to rises of 2.8% in February.

BRC chief executive Helen Dickinson said that both alcoholic and non-alcoholic beverages saw price increases and contributed to this rise in ambient food inflation “due to changes in duties and the hangover from high global sugar prices”.

However, fresh food inflation decreased to 1.4%, against a growth of 1.5% in February.

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Dickinson continued: “Retailers continue to do all they can to protect customers from the cost pressures bearing down on the industry.”

However, she added that the £7bn in additional costs that retailers face later this week as a result of the Budget and new packaging taxes later this year, mean “inflation will likely accelerate in the coming months”.

“It is crucial that the Employment Rights Bill and business rates reform don’t further inflate costs and increase red tape,” she said

NIQ head of retailer and business insight Mike Watkins said: “There is competition on the high street as retailers look to pull in reluctant shoppers with seasonal promotions. However, with upwards pressure on prices, retailers may also need some focused price cuts to help footfall in the run up to the late Easter.”