Shop prices drop 1.7% in December
Shop prices fell again in December to mark the twentieth consecutive month of deflation.
Figures released by the British Retail Consortium and Nielsen in their monthly index show that shop prices fell by 1.7% overall in December. This follows a drop of 1.9% in November.
Food reported annual inflation of 0.1% in December after reporting deflation of 0.2% in November.
Meanwhile, non-food deflation slowed marginally to 2.8% in December from 2.9% in November.
Helen Dickinson, BRC director general, said: “A number of key commodities in the retail supply chain, in particular oil, have fallen dramatically recently and the impact of these falls will continue to make its way through to shop prices for some time to come.”
The BRC said the significant run of deflation was not all bad news for retailers. Dickinson added: “The Producers Price Index (which tracks the cost of raw materials to producers) is deflationary so retail businesses have seen significant decreases in their own input costs.”
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