LONDON, 2014-4-9 — /EPR Retail News/ — Overall shop prices reported deflation for the eleventh consecutive month in March, accelerating to 1.7% from 1.4% in February.
This is the deepest level of deflation since the series began in December 2006.
Food inflation slowed to 0.8% from 1.1% in February – the lowest ever recorded.
Non-food reported annual deflation of 3.2% in March from 3.0% in February – the lowest ever recorded.
Helen Dickinson, British Retail Consortium Director General, said: “Retailers have rightly been getting recognition for their contribution to the economic recovery, including good news recently on apprentices and training. But keeping costs down for ordinary people is just as important. And that’s why the continuing deflation we are seeing in shop prices is such good news for consumers.
“It’s strong industry wide competition as retailers vie for a share of limited spending capacity that is driving this record breaking run. Retailers have been responding to their customers with keen prices and promotions to maintain market share, and March saw the deepest deflation for eight years and the lowest inflation ever recorded for food. With food and drink representing 15 per cent of disposable income for the least affluent third of households, retail’s significant contribution to maintaining standards of living is clear.
“The outlook on commodity prices shows some upwards pressures. So, while we know retailers will be working hard to sustain these low prices, continued support from Government on other costs such as business rates reform and the recent reliefs for National Insurance Contributions will be key to maintaining this positive trend.”
Mike Watkins, Head of Retailer and Business Insight, Nielsen, said: “Savvy shopping and looking for savings by buying on promotion, is the way that most shoppers now look to save money and the continued fall in shop prices will also be helping households to keep to their budget. After a difficult start to the year for the industry with falling volumes in food and unpredictable weather impacting non-food, the current respite in inflationary pressure will be welcomed by retailers”
British Retail Consortium, 21 Dartmouth Street, Westminster, London, SW1H 9BP. 020 7854 8900. info@brc.org.uk.