Shop price inflation slows in January
Shop price inflation slowed in January as retailers held down prices to attract cash-strapped shoppers.
The BRC-Nielsen shop price index showed that overall shop price inflation fell to 1.4% during the month from 1.7% in December. Food inflation fell to 3.7% from 4.2% while non-food inflation fell to zero from 0.3%.
Stephen Robertson, British Retail Consortium director general, said: “With the impact of the 2011 VAT rise finally gone from annual comparisons these figures show how retailers are holding down prices for customers despite a range of upward pressures. Even though retailers are facing higher transport and property costs, overall non-food prices are exactly the same as a year ago. Within that, clothing, furniture and electricals were all cheaper than 12 months ago with the price of electrical goods falling at its fastest rate for three years.
“Food price inflation continues to come down and is now the lowest it’s been since July 2010 thanks to discounting and cheaper commodity costs working through.
Mike Watkins, senior manager, retailer services, Nielsen said:”Shoppers are indicating that they still need to economise on spending in 2012. With retail sales after Christmas off to a slow start, food retailers in particular continued to offer savings in January with price cuts and promotions on everyday items being used across the industry. These initiatives as well as the underlying slowing of inflation and the annualisation of the VAT increase, are bringing shop prices down and closer to the historical levels we have seen over the last few years.”
