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Established 1996
Sunday 23 February 2020


Shop prices return to deflation

Written by Peter Walker

Shop Prices turned deflationary for the first time since October 2018, according to the latest British Retail Consortium (BRC) and Nielsen figures. In June, shop prices fell by 0.1 per cent, compared to May when prices increased by 0.8 per cent.

Non-food prices were also back in deflationary territory in June, recording a decrease of 1.2 per cent from the 0.2 per cent increase in May.

Food inflation was steady at 1.8 per cent in June, while fresh food inflation eased to 1.4 per cent from 1.5 per cent in May. Ambient food inflation accelerated to 2.3 per cent in June, from 2.1 per cent in May.

With food inflation steady, June’s headline inflation figure was driven by the sharp decline in non-food prices. Prices of clothing and footwear, furniture, electricals, DIY, and other non-food items were all below the level of June 2015 prices.

BRC chief executive Helen Dickinson explained that while the overall fall in prices was small, and food inflation remains steady, it nonetheless represents a welcome break for consumers after several months of inflation. “It is also a sign of the fierce competition between retailers, which has long kept prices low for British consumers.”

Mike Watkins, head of retailer and business insight at Nielsen, added: “On the non-food High Street, retailers are maintaining the level and depth of price cuts, to help drive footfall following dampened demand due to the weather and wavering retail spending.”


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