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Shop prices slide back into deflation

12th July 2019 - 07:00am
money matters, brc, british retail consortium, nielsen, shop, price, index, deflation, non-food, kbb, kbbdaily, retail

Shop prices slid back into deflationary territory for the first time since October last year in June, according to the latest British Retail Consortium – BRC – Nielsen Shop Price Index, with shop prices falling by 0.1% compared with the 0.8% rise recorded in May.

Non-food prices also slipped back into deflationary territory last month, declining by 1.2% – a notable drop from the 0.2% rise seen in May. Food inflation remained steady, meaning June’s figure was “driven by the sharp decline in non-food prices”, the BRC said.

According to the monitor, inflation eased for four of the seven non-food index categories, with the remaining three in deflationary territory. The BRC said that due to shoppers’ finances being under “significant strains”, non-food retailers “catering to discretionary demands” have bore the brunt.

Furniture, electricals, DIY and other non-food categories were all below the level of June 2015 prices last months, while “technological changes” have resulted in long-term price declines in electricals, coupled with weak consumer spend.

“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,” said Nielsen retailer and business insight head Mike Watkins.

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