Increase in cost of oil has affected manufacturing and transport, BRC says

Shop price inflation reaches 2%

Shop price inflation rose to two per cent in April, compared to 1.2 per cent in March, according to the British Retail Consortium.

The Shop Price Index found that inflation in price was the same for both food and non-food.

Stephen Robertson, director general of the BRC, said: "Rising costs edged overall shop price inflation up, but it’s still below the rates seen in December and January.

"Oil, which is up 70 per cent over the year… influenced some non-food prices as manufacturing and transport costs went up. VAT is also higher than a year ago.

"But the main effects of rising costs and the weak pound have now been felt. With demand still weak, shop prices should be more stable in future months, as long as there are no more big shocks."

Mike Watkins, senior manager of retailer services at Nielsen, added: "The Shop Price Index this month reflects the end of some seasonal and Easter discounts and, for food retailers, this also comes after the lowest inflation for three years.

“Retailers across all channels continue to rely on promotions, deep discounts and a range of initiatives to drive loyalty and sales as shopper demand remains unpredictable."

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