Posted 6th Nov 2018

Shop prices fall back into deflationary territory

By KBBDaily on 6th November 2018 - 07:00am
money matters, brc, british retail consortium, nielsen, shop, price, index, deflation, non-food, kbb, kbbdaily, retail

After two months of “mild” inflation, UK shop prices fell back into deflationary territory in October, according to the latest British Retail Consortium – BRC – Nielsen Shop Price Index, with prices decreasing by 0.2% year-on-year compared with the 0.2% increase seen in September.

Non-food shop price deflation deepened in October to 1.1% from the 0.9% recorded in September, the BRC said, reflecting a “return to the recent trend in which the strength of competition in the face of weak consumer demand has led retailers to keep prices low and falling”.

“As we approach the Christmas period, retailers are facing stiff competition; driving down the prices of many goods including clothing and electricals,” said BRC CEO Helen Dickinson. “This comes at a particularly difficult time, with lower consumer demand, a weak pound and rising public policy costs all putting pressure on retail margins.”

Nielsen retailer and business insight head Mike Watkins added: “Non-food continues to show deflation with discounting continuing, especially within discretionary items. Consumers remain uncertain about when and where to spend and with Christmas promotions now kicking in, competition for share of wallet will intensify in both food and non-food retailing.”

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