The BRC has warned the trend of falling shop prices could be coming to an end as retailers face higher costs following announcements made in last month’s Budget.
Shop prices fell 0.6% in November, up from deflation of 0.8% in the previous month, according to data from the trade body and NIQ.
This marked the first time in 17 months that prices fell less than the previous month.
Non-Food remained in deflation at -1.8% in November, up from -2.1% in October, while food price rises slowed 0.1 percentage point to 1.8%.
The warning of the end of falling inflation comes as retail bosses have said that changes to employers’ National Insurance Contributions in April would add millions of pounds to its tax bills.
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Over 70 retailers including Tesco, Sainsbury’s, Next, Amazon, and Boots wrote to Reeves last week, cautioning that the “sheer scale” of the new costs on companies would increase inflation as “it will not be possible to absorb such significant cost increases”.
BRC chief executive Helen Dickinson said: “November was the first time in 17 months that shop price inflation has been higher than the previous month, albeit remaining overall in negative territory.
“With significant price pressures on the horizon, November’s figures may signal the end of falling inflation.
“The industry faces £7bn of additional costs in 2025 because of changes to Employers’ National Insurance Contributions, business rates, an increase to the minimum wage and a new packaging levy.
“Retail already operates on slim margins, so these new costs will inevitably lead to higher prices. If the government wants to prevent this, it must reconsider the existing timelines for the new packaging levy, while ensuring any changes to business rates offer a meaningful reduction for all retailers as early as possible.”
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