Shop prices fell by 1.7% in March
UK shop prices fell by 1.7% in March following a 2% decline in February as a result of continuing intense competition and retailers ongoing investment in price. The decline means that prices have fallen for a 35th consecutive month.
The figures from the British Retail Consortium and KPMG’s monthly shop price index show that non-food deflation rose to 2.6% in March from the 3% fall in February while food deflation remained at 0.4% for the second consecutive month.
Helen Dickinson, BRC chief executive, said: “Despite consumer confidence remaining at zero, a relatively benign economic environment (inflation remains very low and oil is trading at just under $40 per barrel) and a fiercely competitive market will see retailers continue to respond to their customers with prices and promotions to maintain market share as the Spring season kicks off.”
Fresh food saw annual deflation of 0.9% for the second month in a row. Meanwhile, ambient food inflation rose to 0.4% in March, slightly above the 0.3% reported in February.
Mike Watkins, head of retailer and business insight at Nielsen, said: “Shoppers are still making changes to how they spend to stay within their household budget and looking out for price cuts and promotions is one of the ways to save money. With Spring arriving, retailers will be hsaid: oping that this drives store traffic as so far this year, retail sales have been rather unpredictable.”
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