Shop prices in the UK fell 0.4% year-on-year in October, a fifth consecutive month of decline, the latest data from BRC-Nielsen Shop Price Index has revealed.
The price of non-food items declined by 1.5% in October, below the 12- and 6-month average price declines of 0.7% and 1.2% respectively.
Helen Dickinson OBE, chief executive, British Retail Consortium, said, "Non-food prices have fallen well below the 12-month average, with greater discounting taking place as retailers seek to stimulate additional sales.
"The year has seen relatively weak sales and retailers hope that Black Friday and Christmas will reverse this trend with the help of lower prices."
Food inflation accelerated to 1.6% in October from 1.1% in September, data showed.
It is slightly below the 12-month average price increase of 1.7% and in line with the 6-month average price increase of 1.6%.
Fresh food inflation increased marginally to 0.8% in October from 0.7% in September, below the 12- and 6-month average price increases of 1.3% and 1.2%, respectively.
Inflation in the ambient food segment accelerated to 2.7% in October from 1.7% in September.
This is the only category that witnessed an increase above the 12- and 6-month average price increases of 2.3% and 2.2%.
'Uncertain Economic Outlook'
Head of retailer and business insight at Nielsen, Mike Watkins, said, "With an uncertain economic outlook at the start of the 'golden quarter', the industry has been working hard to stimulate demand and to keep price increases as low as possible.
"Seasonal ranges are now in store, and we can expect an increase in promotional activity in the run-up to Christmas, which will give shoppers further savings at the checkout."
Dickinson added, "Rising global food prices and the higher oil prices from earlier this year will increase costs for retailers. These factors come as the industry struggles with the burden of public policy costs, such as business rates, which is weighing heavily on the industry and keeping margins at record lows.
"Furthermore, while the threat of a no-deal Brexit has been pushed back, it has not gone away. To remove this threat, and the price rises that would result, the government must secure an agreement with the EU as soon as possible to give consumers and retailers the certainty they need."
© 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.