Shop price inflation in the UK slowed in early October, according to the British Retail Consortium (BRC), providing some relief for consumers ahead of Halloween.
Between 1–7 October, overall shop price inflation decreased to 1.0% year on year, down from 1.4% in September and below the three-month average of 1.1%.
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Non-food inflation fell to -0.4%, compared with -0.1% in September, in line with the three-month average of -0.4%. Meanwhile, food inflation decreased to 3.7%, down from 4.2% in September, slightly below the three-month average of 4.0%. Fresh food prices rose slightly to 4.3%, above the three-month average of 4.2%, while ambient food inflation eased to 2.9%, below the three-month average of 3.8%.
Helen Dickinson, Chief Executive of the BRC, said:
"Overall shop price inflation slowed in October, driven by fierce competition amongst retailers and widespread discounting. Beyond food, discounts came early to electricals and health & beauty, as retailers started promotions ahead of Black Friday month."
Dickinson added:
"The IMF recently warned that UK inflation will be the highest in the G7. With the Budget less than a month away, the Chancellor has an opportunity to relieve some of the pressures that are keeping the cost of essentials high. Labour's promised business rates reform must deliver a meaningful cut to retailers' rates bills, and ensure that no store pays more. Rising employer National Insurance Contributions and a new packaging tax have directly contributed towards rising inflation, according to the Bank of England. Adding further taxes on retail businesses would inevitably keep inflation higher for longer."
Mike Watkins, Head of Retailer and Business Insight at NIQ, added:
"Inflation is higher than a year ago, and with pressure on household budgets and weak sentiment, retail spend continues to be subdued."
The data highlights ongoing challenges for consumers and retailers, but early seasonal promotions are helping to mitigate price pressures ahead of the critical retail period.
More information:
BRC
[email protected]
www.brc.org.uk
