UK shop prices dropped 0.1% year on year in June – a first since October 2018 – data from the latest BRC-Nielsen Shop Price Index has revealed.
Shop prices of non-food items fell by 1.2%, year on year, during the same period.
The figures in the food category showed a 1.8% year-on-year increase in June, while the shop prices of fresh food rose by 1.4%.
In the ambient food category, the study reported a 2.3% year-on-year increase in shop prices.
‘A Welcome Break’
The chief executive of the British Retail Consortium, Helen Dickinson OBE, said, “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,” Dickinson added.
The head of retailer and business insight at Nielsen, Mike Watkins, believes that food inflation will remain stable in the summer months, as many supermarkets will reduce prices to offset cost increases in the supply chain.
The move is expected to boost sales and help consumers save on their household bills.
“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,” Watkins added.
Dickinson cautions that a “no-deal Brexit would hinder retailers’ abilities to continue to contain prices, as checks and delays would raise the cost of doing business.”
“The 31 October deadline also comes at the worst-possible time for retail – the height of preparations for Christmas and Black Friday, which are peak trading periods, threatening to cause disruption for consumers and businesses, and making further stockpiling of goods almost impossible,” she explained.
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Dayeeta Das. Click subscribe to sign up to ESM: European Supermarket Magazine.