Shop prices continued to ease in October amid warnings they remain vulnerable to ongoing geopolitical tensions, climate change and Government regulation.
Overall prices dropped by 0.8% compared to last year, the third consecutive monthly fall and a drop from September’s 0.6% deflation, according to the British Retail Consortium (BRC)-NielsenIQ Shop Price Index.
Non-food prices remained down by 2.1%, consistent with September’s figures. Electronics, like mobile phones, saw steep price drops, and DIY costs fell as retailers benefited from a recent boost in the housing market.
However, fashion prices edged up for the first time since January, as stores scaled back the deep discounts seen over the past year.
Food inflation eased to 1.9%, down from 2.3% last month, with items like meat, fish, tea, and sweets becoming more affordable, partly due to Halloween promotions.
Commenting on these trends, BRC chief executive Helen Dickinson shared: “Households will welcome the continued easing of price inflation, but this downward trajectory is vulnerable to ongoing geopolitical tensions, the impact of climate change on food supplies, and costs from planned and trailed Government regulation.
“Retail is already paying more than its fair share of taxes compared to other industries.”
According to the BRC, a 20% reduction in business rates would enable retailers to maintain competitive pricing, open new stores, safeguard jobs, and stimulate investment.
Mike Watkins, head of retailer and business insight at NielsenIQ, noted: “Inflation in the food supply chain continues to ease and this helped slow the upward pressure of shop price inflation in October, however, other cost pressures remain.
“Consumers remain uncertain about when and where to spend and with Christmas promotions now kicking in, competition for discretionary spend will intensify in both food and non-food retailing.”