UK shop price inflation falls to 32-month low

1st Jul 2024 10:35

(Sharecast News) - The annual growth in prices at UK tills slowed significantly in June, according to the latest shop price index released by the British Retail Consortium (BRC) and NielsenIQ.

Shop price inflation eased to a year-on-year rate of just 0.2% last month, down from 0.6% in May and the lowest rate of price growth since October 2021.

Non-food prices were down 1% on last year, with deflation accelerating from the -0.8% level reported in May, while food inflation slowed to 2.5% from 3.2% a month earlier.

Slowdowns were reported in both fresh food (1.5%, down from 2.0%) and ambient food (3.9%, down from 4.8%).

The BRC said the deceleration in price growth was a result of heavy investments by retailers to improve operations and supply chains during the height of the cost-of-living crisis, to mitigate the impact of input cost pressures.

"This is clearly paying off, with shop prices having risen just 0.2% over the past 12 months," said the BRC's chief executive Helen Dickinson.

"Whoever wins Thursday's election will benefit from the work of retailers to cut their costs and prices, easing the cost of living for millions of household.

"The last few years should serve as a warning that where business costs rise significantly, consumer prices are forced up too. The next government must address some of the major cost burdens weighing down the retail industry, including the broken business rates system, and inflexible apprenticeship levy."