UK shop prices dropped by 1.9 per cent in May compared with the same month last year, according to figures released today by the British Retail Consortium.
This is the same rate of decline seen in April and marks over two years of shop price deflation. The overall figure was helped by food prices, which fell 0.9 per cent on the year in May, their third consecutive month of deflation.
“Retailers continue to use price cuts and promotions to stimulate sales, which is helping to maintain shop price deflation, and we see little evidence to suggest that prices will rise in the near future,” said Mike Watkins from market analysts Nielsen.
“With many food retailers still using price cuts to attract new shoppers, this is lowering the cost of the weekly shop.”
“Deflation and price-led competition will continue to be a key driver of sales growth for some time yet.”