Shop prices continue to fall into deflation to reach their lowest level in three years, with furniture and clothing seeing the biggest drops in prices.

The latest BRC-NielsenIQ Shop Price Index reveals that the annual shop price deflation was at -0.6% in September, down from a deflation of -0.3% the previous month.

This was below the three-month average rate of -0.3% and reached its lowest since August 2021.

Food inflation did see a small rise in inflation to 2.3% in September, up from 2% in August. This was above the three-month average of 2.2% and the annual rate of food inflation stayed at its lowest since November 2021.

 

Fresh food inflation increased to 1.5% in September from 1% in August, while ambient food inflation declined to 3.3% during this period, down from 3.4% the previous month.

Non-food remained in deflation at -2.1% in September, down from a deflation of -1.5% the previous month.

BRC chief executive Helen Dickinson said: “September was a good month for bargain hunters as big discounts and fierce competition pushed shop prices further into deflation. 

“Shop price inflation is now at its lowest level in over three years, with monthly prices dropping in seven of the last nine months. This was driven by non-food, with Furniture and Clothing showing the biggest drops in inflation as retailers tried to entice shoppers back. Food inflation edged up slightly as poor harvests in key producing regions led to higher prices for cooking oils and sugary products.

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Annual shop price deflation was at -0.6% in September, its lowest since August 2021

“Easing price inflation will certainly be welcomed by consumers, but ongoing geopolitical tensions, climate change, and government-imposed regulatory costs could all reverse this trend. 

“Retail faces a disproportionate tax burden compared to other industries and the Government must take decisive action in the upcoming Budget and introduce a 20% Retail Rates Corrector – a 20% adjustment to bills for all retail properties – to level the playing field. This will allow retailers to continue to offer the best possible prices to their customers while opening shops, protecting jobs and unlocking investment.”

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