UK sees four years of falling store prices

London - Four years of falling shop prices have seen store costs deflate 0.5 percent in April, down from 0.8 percent in March.

According to the British Retail Consortium, this is the shallowest deflation rate in four years, since November 2013.

Prices on apparel and footwear saw the further decline, down 5.4 percent year on year. Non-food deflation decelerated to 1.4 percent from the 2.0 percent decline in March.

Helen Dickinson, BRC's Chief Executive stated: “This month’s figures mark the four-year anniversary of falling shop prices as competition in the industry continues to keep a lid on prices for consumers. Nevertheless, the rate of deflation has been decelerating month-on month as retailers battle with inflationary pressures resulting from the impact of the weaker pound on input prices.

“Prices are undoubtedly on an upward trajectory, which we expect to gradually play out over the course of the year. With the squeeze on household incomes tightening, the retail industry expects plans from the next Government that puts consumers first in the Brexit negotiations, ensuring that ordinary shoppers are protected from the cost of unwanted new tariffs.”

Mike Watkins, Head of Retailer and Business Insight, Nielsen commented: "Shoppers are seeing inflation in travel, fuel and when spending away from home, so retailers are cautious about passing on cost price increases. So there continues to be deflation in shop prices albeit we are already seeing inflation in food. In the non-food channel and with a late Easter there was a need to stimulate demand and clear stock in readiness for summer ranges, and seasonal promotions also kept prices low as retailers looked to increase footfall and maintain consumer spend.”

Photo credit: Inflation; article source: www.brc.org.uk