Shop prices fall for sixth straight month in October
Shop prices in the UK fell for a sixth consecutive month in October according to the British Retail Consortium-Nielsen shop price index.
Overall shop prices dropped 0.5% from the same month a year earlier, following the 0.2% decline reported in September. Although food inflation rose 2.7% year-on-year, non-food prices fell by 2.4%.
The BRC said the drop in non-food prices was mainly driven by promotions on clothing and widespread offers on new books launched in time for Christmas. Prices were also affected by retailers competing for strong pre-Christmas demand for gadgets and games.
BRC director general Helen Dickinson said: “After inching up slightly in September, inflation has again matched the record low we saw in July and August, marking the highest October deflation rate since our index began.
Never Miss a Retail Update!“With Christmas fast approaching, there are good signs that budgets will go a little bit further for many of us this year.”
Mike Watkins, head of retailer and business insight at Nielsen, said: “Retailers are working hard to stimulate demand and it’s of no surprise to see another slowing of shop price inflation, with further deflation in non-food. Based on current trends we also anticipate an increase in promotional spend by food retailers, which will offer cash-strapped consumers further savings ahead of December.”
