Shop prices down 2% in December
Shop prices in the UK fell by 2% in December following a 2.1% decline in November.
The figures released by the British Retail Consortium and Nielsen in their monthly shop price index show that food prices reported annual deflation of 0.3% which was unchanged from November’s rate.
Meanwhile, non-food deflation decelerated to 3% from 3.3% in November.
The BRC said prices are likely to continue to fall in the medium term due to relatively low commodity prices, intense competition, and investment by retailers in price.
BRC chief executive Helen Dickinson said: “Prices in Britain’s shops have continued to tumble, this month by 2%. For the last two years and eight months, customers have been able to fill their baskets, whether virtual or physical, and pay less for their goods than the year before. This is an incredible run of good fortune for shoppers who’ve been preoccupied with picking up presents for family and friends, as well as themselves ahead of the holiday season.”
December marked the 33rd month of non-food price drops driven mainly by reductions in clothing, footwear, electricals, DIY, gardening and hardware prices. For the fourth consecutive month all non-food categories saw prices fall.
Dickinson added: “Although trading statements are starting to filter through, we will have to wait until next week to learn if the lower priced goods have translated into positive sales for the market as a whole during the all-important Christmas trading period.”