British shop prices hit record low

The consumer price index has fallen to zero for the first time on record
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Britain’s shops saw a record drop in prices of 2.1 per cent overall, despite the fact that consumer confidence has shot up to a near 13-year high.

A dip in food prices was the result of ongoing promotions, whilst non-food (such as clothes and electricals) deflation accelerated to 2.8 per cent in March from 2.5 per cent in February, hitting a 24th consecutive month of deflation.

Helen Dickinson, director general at BRC, commented: “Prices in Britain’s shops reached another new low, this month by -2.1 per cent. That’s the deepest deflation rate since our records began in December 2006.

“Clothing and electricals continue to outshine by offering consumers eye-catching bargains.

“In fact, there’s evidence of plenty of promotions and price-cuts in non-food items which should help drive up sales at a time when retailers are turning their attention to the summer ranges.”

The BRC-Neilsen shop price index has reported that consumer confidence has risen to around a 13-year high.

Dickinson continued: “Both retailers and consumers will cheer on a hat-trick of good economic news.

“The Consumer price index (CPI) has fallen to zero for the first time on record, boosting incomes in real terms and bringing the UK to the brink of a spell of deflation that is expected in the coming months.”

She also reckons that these kinds of results will result in increased numbers of shoppers on the High Street, and online.

Mike Watkins, head of retail and business insight at Nielson, added: “Prices continue to fall across the retail industry and deflation is likely to be with us for the near future, which means shoppers are going to be able to stretch their budgets further when shopping in store or online.”

Image source: Shutterstock

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