January marks 34th month of non-food price drops

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Overall prices for items in non-food shops have continued to fall for the 34th month in January, according the latest report from the BRC-Nielsen Shop Price Index.

The BRC states that overall shop prices (including food) reported deflation of 1.8% in January from a 2.0% decline seen in December.

Non-food deflation remained at 3.0% for the second consecutive month.

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On a 12-month average basis, the Shop Price Index reported deflation of 1.8%.

BRC chief executive, Helen Dickinson, says: “Shop prices fell by 1.8% last month compared to January 2015 as a result of continuing intense competition and retailers’ ongoing investment in price. This is in line with what we have seen over the last 12 months.

“January marked the 33rd month of falling shop prices and the 34th month of non-food price drops. Non-food prices saw an impressive 3.0% drop for the second consecutive month, driven largely by reductions in clothing, footwear, books, DIY, stationery and home entertainment.”

Mike Watkins, head of Retailer and Business Insight, Nielsen, adds: “Sales momentum in January has been slow for some retailers with shoppers seeking out the best prices online and in store, and this competition is helping keep non-food shop prices lower than a year ago. Many seasonal lines have also come off promotion which will have moved food prices upwards a little, but there is still no general upward pressure on prices, despite recent currency appreciations. Looking ahead, we expect overall shop price deflation to remain broadly unchanged for next few months.”

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