LONDON, 2014-10-10— /EPR Retail News/ — Overall shop prices reported deflation for the seventeenth consecutive month, accelerating to 1.8% in September from 1.6% in August.
Food inflation remained at 0.3% in September – equalling the lowest ever recorded.
Fresh food inflation was flat for September; this is the first month since Feb 2010 that the category hasn’t experience inflation.
Non-food reported acceleration in deflation of 3.2% in September from 2.9% in August.
Helen Dickinson, British Retail Consortium Director General, said: “The seventeenth consecutive month of deflation is good news for hard-pressed households. Retailers are turning their attention to Christmas by reading current conditions and matching consumer sentiment well with their promotions and offers.
“In particular, food inflation remained at an all-time low. In September, over a third of all groceries going through the tills were on some sort of promotion or special offer, meaning savvy shoppers are picking the deals that work best for them – allowing them to effectively budget. Fresh food prices remained flat – something not seen since February 2010 – which will help those struggling in the current economic climate, including the country’s least affluent 30% who spend as much as 16% of their income on food and non-alcoholic goods. Non-food prices fell significantly, mainly fuelled by great bargains in furniture, flooring and electricals as increased activity in the housing market supported robust sales.
“Consumers can take heart that the outlook for inflation remains modest. Falling commodity prices, the strengthening of sterling, benign pressure in the supply chain and, critically, fierce competition across the retail industry suggests lower shop prices for consumers will continue.”
Mike Watkins, Head of Retailer and Business Insight, Nielsen, said: “There are historic low levels of price increases across the high street, and with more price cuts expected from Supermarkets over the next few weeks shoppers will continue get great savings. Whilst sales patterns are still difficult to predict not least following the unusually warm late summer, we can anticipate a continuation of the current low levels inflation and even deflation for the rest of the year. This will help shoppers to plan their spending in the run up to the start of Christmas trading.”
British Retail Consortium, 21 Dartmouth Street, Westminster, London, SW1H 9BP. 020 7854 8900. info@brc.org.uk.