Shop prices continued to fall in September as food inflation eased and non-food retailers ran more promotions to encourage cautious consumers to spend.
The overall figure from the BRC-Nielsen Index showed the decline remained at 1.6%, the same as in August.
Non-Food prices fell by 3.2% compared to 3.4% last month, with clothing and footwear sectors seeing the biggest cuts.
Food inflation eased slightly from 1.3% to 1.2% as the supermarket price war began to escalate. At 0.2%, fresh food inflation remained at its lowest rate since 2017, driven by the continued good availability of produce. Ambient food inflation slowed to 2.5% in September, down from 2.8%.
Helen Dickinson, Chief Executive of the British Retail Consortium, highlighted that hard-pressed consumers would welcome yet another month of falling shop prices. However, she warned that a looming no-deal Brexit may come at a heavy cost.
“Retailers strive to provide the best value, quality goods, but their ability to do so, come 2021, is under threat,” said Dickinson.
“Without a zero-tariff deal with the EU, supermarkets will be subjected to £3.1bn a year of tariffs on food and drink, which they will have little choice but to pass on to their customers as retail margins are so thin. Many non-food retailers will also face large tariff bills, and as a result, the total cost to the industry and its customers would be much higher.
“The Government must prioritise a tariff-free deal, otherwise hard-pressed consumers will bear the brunt of price increases.”
