Shoppers stay at home while prices creep up

Tim Wallace
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SHOP prices increased again in May while footfall kept dropping, industry data showed today.

Overall shop price inflation hit 0.4 per cent in May, up from 0.2 per cent in April, according to British Retail Consortium figures, taking the annual price rise up to 1.5 per cent.

Food price inflation jumped to 0.6 per cent on the month, from 0.1 per cent in April, keeping price rises in the year to May at 4.3 per cent.

Meanwhile non-food prices rose 0.3 per cent in May, faster than the 0.2 per cent recorded in April, taking the annual fall in prices to -0.1 per cent, from 0.5 per cent in the year to April.

Furniture and floor covering prices rose particularly strongly, up 0.8 per cent in May to reverse a 0.4 per cent fall in April, while health and beauty products saw prices rise 1.3 per cent after staying flat in April.

Electrical goods saw the fastest fall, dropping 0.4 per cent in the month, closely followed by a 0.3 per cent drop in DIY, gardening and homeware prices.

“With the summer of events and celebration now under way, and after a couple of months of weak sales, marketing programmes and promotions have been ramped up by retailers,” said Mike Watkins from Nielsen.

“Although the overall level of food inflation remains unchanged, the underlying ambient inflation is the lowest since January which is good news for the consumer.”

However, despite lower inflation and increased promotions, footfall to town centres is still slumping, Springboard’s national high street index showed.

Footfall fell 3.5 per cent in the year to May overall, while greater London saw a six per cent fall.

However, there was a rebound in the month after April’s washout, with footfall up five per cent across the country and 3.6 per cent in London.