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Food price wars rein in rising costs

By Josie Clarke

Food prices are edging upwards, but competition between supermarkets is shielding shoppers from cost increases for the time being, figures show.

Overall, shop prices are 1% lower than last February, continuing a trend that has lasted almost four years, the BRC-Nielsen Shop Price Index shows.

However, the figure is a sharp deceleration from the 1.7% fall in January, while food showed inflation of 0.4% in February - the first inflationary rise since April last year.

Non-food deflation decelerated to 1.8% in February, an easing from the 2.3% decline in January.

British Retail Consortium chief executive Helen Dickinson said: "It is clear that the significant underlying cost pressures which have been building over the last year are beginning to filter through into shop prices.

"Global food prices were on average 16% higher at the beginning of this year compared to last, whilst over the same period the value of the pound fell around 15%."

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