Shop prices decline further in September
UK shop prices fell at a faster rate in September to mark the seventeenth consecutive month of deflation.
Figures released by the British Retail Consortium and Nielsen in their monthly index show that shop prices dropped by 1.8% compared to a year earlier. The decline follows a 1.6% fall in August.
Food inflation remained at 0.3% in September to equal the lowest ever recorded. Fresh food prices were flat which meant that September was the first month since February 2010 when the category did not experience inflation. The BRC said over a third of all groceries going through the tills in September were on some sort of promotion or special offer.
Meanwhile, non-food reported an acceleration in deflation of 3.2% in September from 2.9% in August. The BRC said non-food prices fell significantly, mainly fuelled by bargains in furniture, flooring and electricals as increased activity in the housing market supported robust sales.
Never Miss a Retail Update!BRC director general Helen Dickinson said: “The seventeenth consecutive month of deflation is good news for hard-pressed households. Retailers are turning their attention to Christmas by reading current conditions and matching consumer sentiment well with their promotions and offers.
“Consumers can take heart that the outlook for inflation remains modest. Falling commodity prices, the strengthening of sterling, benign pressure in the supply chain and, critically, fierce competition across the retail industry suggests lower shop prices for consumers will continue.”
Mike Watkins, head of retailer and business insight at Nielsen, added: “Whilst sales patterns are still difficult to predict not least following the unusually warm late summer, we can anticipate a continuation of the current low levels inflation and even deflation for the rest of the year. This will help shoppers to plan their spending in the run up to the start of Christmas trading.”
