THE growth in shop prices lost momentum in May as consumer uncertainty forced retailers to keep prices low, according to the latest survey from the British Retail Consortium (BRC).
Overall annual shop price inflation fell to 1.8 per cent last month compared to two per cent in April despite big rises in some costs. Transport costs are still being pushed up by past rises in the price of oil, while international shipping prices are up over a third and cotton prices are up 40 per cent on a year earlier.
But Stephen Robertson, director-general of the British Retail Consortium (BRC), said:
“Clothes and electricals are cheaper than they were last year, as retailers hold prices down in the face of customers’ reluctance to spend.”
However, while non-food inflation slowed to 1.6 per cent in May from two per cent in April, food inflation rose to 2.2 per cent. This is, however, expected to ease in the coming months as recent falls in commodities, such as wheat and coffee, have yet to work through to shop prices.