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Shop prices fall for 25th month

Published 03/06/2015

The run of falling shop prices has now lasted more than two years
The run of falling shop prices has now lasted more than two years

Shop prices fell for the 25th month in a row in May, new figures have revealed.

The BRC-Nielsen shop price index showed year-on-year deflation at 1.9%, the same as in April, meaning the run of falling prices has now lasted more than two years.

Food prices were 0.9% down while in non-food the fall was 2.5%, both the same rate as in the previous month.

It comes after official figures showed Consumer Price Index (CPI) inflation slipped into negative territory at minus 0.1% in April.

Mike Watkins, head of retailer and business insight at Nielsen, said: "Retailers continue to use price cuts and promotions to stimulate sales, and we see little evidence to suggest that prices will rise in the near future.

"With many food retailers still using price cuts to attract new shoppers, this is lowering the cost of the weekly shop and so the overall CPI figure in the UK.

"Deflation and price-led competition will continue to be a key driver of sales growth for some time yet."

Food deflation remained at a record low of 0.9% for a third month in a row. Fresh food led the fall with deflation of 1.9%, led by products such as meat, milk, cheese and eggs.

The cost of ambient foods - which includes tins and packets - rose 0.5% due to alcoholic beverages, sugar, jams and chocolate.

Non-food saw "deep deflation" of 6.4% in clothing and footwear and 5.2% in electrical goods, though in both cases this was less steep than in April. Health and beauty prices rose 1.6%.

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