May 8, 2013

Shop price inflation in UK down at 0.4% in April 2013

Overall shop price inflation in UK dropped to 0.4% in the month of April 2013, against 1.4% recorded in the previous month, according to the British Retail Consortium (BRC).

By admin-demo

Overall shop price inflation in UK dropped to 0.4% in the month of April 2013, against 1.4% recorded in the previous month, according to the British Retail Consortium (BRC).

The drop is said to be the lowest over the last three and half years. It is being attributed to heavy promotional initiatives by the retailers.

The food inflation for the month fell to 2.9%, from 3.5% in March 2013, while non-food declined to 1% after a 0.2% rise in the preceding month.

Fall in food inflation is driven by fresh, tinned and packet items along with drop in key costs working through.

BRC director general Helen Dickinson stated that overall shop price inflation in April slumped acutely in comparison to the previous month.

"Household finances are still under pressure but it’s clear that isn’t coming from the shops," Dickinson added.

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"In particular, price competition on non-food goods intensified in the face of average incomes rising at their slowest for more than a decade and poor demand for seasonal products.

"Spring lines, in fashion and gardening for example, have not taken off in the way they did last year because warmer weather has been much more reluctant to take hold.

"The big drop in overall shop price inflation has given us the largest gap for over a year between the SPI and the wider Consumer Price Index which includes energy and housing costs," concluded Dickinson.

Nielsen retailer and business insight head Mike Watkins stated: "Retailers will now be looking to keep prices competitive over the next few weeks to keep whatever momentum there is in sales growth going, and for high street retailers this could require summer discounts to start sooner rather than later."