UK shop prices continue to fall

Prices in British shops continued to fall last month, marking the 23rd month of decline, as well as the fastest rate since records began more than eight years ago, helped by the sharp decline in food prices, the British Retail Consortium said.

Figures released by the BRC and Nielsen in their monthly index show retail prices in March were 2.1 percent lower than a year earlier. Prices had fallen 1.7 percent in February.

Non-food prices dropped by 2.8 percent last month, following a 2.5 percent fall in February, while food reported annual deflation of 0.9 percent in March from a 0.4 percent fall in February.

BRC Director General, Helen Dickinson, said: “Clothing and electricals continue to outshine by offering consumers eye-catching bargains. In fact, there’s evidence of plenty of promotions and price-cuts in non-food items which should help drive up sales at a time when retailers are turning their attention to the summer ranges.

“Both retailers and consumers will cheer on a hat-trick of good economic news. The Consumer price index (CPI) has fallen to zero for the first time on record, boosting incomes in real terms and bringing the UK to the brink of a spell of deflation that is expected in the coming months.”

Mike Watkins, head of retailer and business insight at Nielsen, added: “Prices continue to fall across the retail industry and deflation is likely to be with us for the near future, which means shoppers are going to be able to stretch their budgets further when shopping in store or online.”