Shop price inflation across the UK has fallen to its lowest point since November 2021, as consumers clamp down on spending and businesses slash the prices of large purchases.
The British Retail Consortium (BRC) and NielsenIQ found prices were up 0.6% in May on an annual basis, down from 0.8% the previous month, marking the slowest rate since November 2021.
Non-food prices led the drop, sinking by an annual rate of 0.8% for the month, representing the largest decline since 2021.
Meanwhile, food prices increased 3.2% from 3.4% in April, as price rises eased on fresh food despite worries over production amid the poor spring weather.
NielsenIQ head of business insight Mike Watkins said: “After a number of months of falling input prices, we are now seeing food inflation stabilise and retailers continue to pass on price cuts to shoppers.
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BRC CEO Helen Dickinson added: “Shop price inflation has returned to normal levels, at just 0.6%. This was helped by slowing food inflation, with fresh food inflation falling to its lowest level since November 2021.
“Meanwhile, ambient food inflation remained stickier, especially for sugary products which continued to feel the effects of high global sugar prices.”
“In non-food, retailers cut furniture prices in an attempt to revive subdued consumer demand for big-ticket items, and football fans have been able to grab some bargains on TVs and other audio-visual equipment ahead of this summer’s Euros.”
Meanwhile, UK consumer confidence improved last month, as falling inflation helped boost consumer optimism about their personal finances.
The GfK Consumer Confidence Index rose two points to -19, marking an improvement from -21 points in both March and February. Additionally, its major purchase index strengthened, up 2 points at -25.
In March, UK shop price inflation fell to its lowest level since December 2021 as retailers battled to win shoppers, the BRC-NielsenIQ Shop Price Index found.
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