Lower Shop Prices In February Ease Pressure As UK Has “passed the peak” Of Inflation
New data from BRC-Nielsen Shop Price Index, deflation grew from 0.5% in January to 0.8% throughout the last month.
These figures helped by a slowdown in food deflation, easing from 1.9% in January to 1.6%.
Ambient food inflation saw a month-on-month rise of 0.3% to 2.5%, fresh food dropped from 1.7% to 0.9%, lowest since September 2017.
“This is a further sign that we have passed the peak of the upward pressure on inflation caused by the fall in the pound in June 2016,” British Retail Consortium chief executive Helen Dickinson said.
Over coming year this will squeeze on consumer incomes, but it is likely to do little to lift the rate of growth in consumption.
“In real terms earnings are still falling despite increase in wages and savings are unlikely to provide the same support to spending that they have over the last 18 months.”
Good news for consumers as the earnings and inflation are heading in the right directions for consumers, retailers can expect to see more of the same tough trading environment over the coming months.
Keeping it in mind, its imperative we get clarity and a definitive agreement over the next month’s Brexit negotiations around the exact form of the transition arrangements.
“Both the transition and the UK’s future relationship with the EU will determine how we maintain consumers’ current access to a diverse choice of affordable goods.”