Shop price inflation eases in August
Shop price inflation fell slightly in August as a result of slowing food inflation and a weakening in global commodity prices.
The BRC-Nielsen Shop Price Index showed that shop price inflation moved down to 2.7% in the month from 2.8% in July.
Food price inflation slowed to 5% from 5.2% in July. However, the BRC warned that competition between retailers was protecting consumers from the full impact of food inflation saying that “nearly 40% per cent of all groceries going through the tills are on some sort of promotion or special offer.”
Non-food inflation increased to 1.4% from 1.3% in July as a result of increases in the prices of DIY, gardening and hardware goods.
Commenting on the figures BRC Director Stephen Robertson said: “This is a modest piece of good news for hard-pressed households. For the second month in a row a fall in overall shop price inflation can be put down to food inflation slowing. Global commodities, such as wheat, have dropped from the peaks they reached earlier in the year, though costs remain high. And good harvests of fresh fruit and vegetables such as apples, plums and corn-on-the-cob have also helped keep food prices down.”
He added: “There has been a small rise in non-food inflation but it remains well below the level that could be expected following January’s VAT rise. Retailers of big-ticket items in particular are dependent on high levels of discounting to make sales, keeping prices down for customers.”
