Shop price deflation was -1.0% in December, up from deflation of -0.6% in the previous month, report BRC-NielsenIQ in their latest Shop Price Index. This was slightly above the 3-month average rate of -0.8%. Shop price annual growth remained at its lowest rate since August 2021.
Non-food remained in deflation at -2.4% in December, edging down from -1.8% in the preceding month. This was below the 3-month average rate of -2.1%.
Helen Dickinson, chief executive of the BRC, says: “Retailers discounted heavily for Black Friday this year as they attempted to make up for weaker sales earlier in the year. However, the later Black Friday timing brought many of the non-food discounts into the measurement period, making non-food prices look more deflationary than the underlying trend. With food inflation bottoming out at 1.8%, and many price pressures on the horizon, shop price deflation is likely to become a thing of the past."
Mike Watkins, head of retailer and business insight at NielsenIQ, adds: “During December, shoppers benefited from both lower inflation than last year and bigger discounts as both food and non-food retailers were keen to drive sales after a slow start to the quarter. However, higher household costs are unlikely to dissipate anytime soon so retailers will need to carefully manage any inflationary pressure in the months ahead.”
