Overall shop prices reported deflation of 1.4% in July lower than the 1.3% fall in June. On a 12-month average basis, the Shop Price Index reported deflation of 1.7%. Non-food deflation accelerated to 2.3% from 1.9% in June.
BRC director general Helen Dickinson says: “Shop prices fell by 1.4% this month, marking the 27th consecutive month of prices drops which is good news for consumers.
“Furniture and Flooring saw a sharp acceleration in deflation to 2.7% as retailers attempted to capitalise on stronger levels of demand in this category from renewed strength in the housing market.”
Mike Watkins, head of Retailer and Business Insight at Nielsen, says: “Deflation in retailing has been a big influence on sales over the last 12 months, as has the unpredictable weather, price cuts and short term promotions. There have been some attractive sales and offers across non-food retailing in recent weeks. Shoppers are saving money which is helping consumer spend in the wider economy.”
The BRC-Nielsen Shop Price Index (SPI) reported annual deflation of 1.4% in July, marking the 27th consecutive month of falling shop prices. This was driven by Non-Food where deflation accelerated 0.4 percentage points to 2.3%.
Non-Food deflation accelerated in July to 2.3% from 1.9% in June. Deflation in the Furniture and Floorcoverings category accelerated to 2.7%.
On a month-on-month basis prices were 1.2% lower than a year earlier after being broadly flat in June. This is the largest monthly fall since January 2014.
The Furniture and Floorcoverings category saw its deflation rate accelerate to -2.7% from 1.6% in June. This was the lowest deflation rate since December 2014. The Furniture, Furnishings and Carpets category reported a sharp acceleration in its deflation rate, which is now deeper than the overall category rate. Retailers are capitalising on the renewed strength of the housing market, driving consumers into shops with a range of discounts and promotions. Data released by the Bank of England at the end of July showed that mortgage approvals rose to 66,582 in June, above the six month average of 62,971. Retailers will be encouraged by these numbers and hope that this trend continues in the coming months.
Prices fell 3.5% on a month-on-month basis after a 0.5% rise in June.
