Shop price inflation remained steady in July, despite the outlook looking uncertain for the months ahead.
The British Retail Consortium (BRC) and NielsenIQ found that shop price inflation remained flat at 0.2% in July, with shop price annual growth remaining at its lowest rate since October 2021.
Non-food inflation stayed in deflation at -0.9%, up from -1.0% the previous month, hitting its lowest point since October 2021. Meanwhile, food inflation dropped to 2.3%, from 2.5% in June.
Fresh food inflation sank to 1.4% from 1.5% the prior month, while ambient food fell to 3.6%.
BRC CEO Helen Dickinson said: “Shop price inflation in July remained unchanged on the previous month. Non-food price deflation continued, albeit at a slower rate than June.
“Holiday makers could pick up bargain summer wear and summer reads as clothing and footwear prices fell for the seventh consecutive month amidst persistent weak demand, and the prices of books fell.”
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She continued: “The 2023 declines in global food commodity prices continued to feed through, helping bring down food inflation rates over the first seven months of 2024.
“However this shows signs of reversing, suggesting renewed pressure on food prices in the future. Sports gatherings for Wimbledon and the Euros benefitted from discounted snacking items such as crisps and soft drinks.”
The BRC exec noted: “UK households suffered from high levels of inflation in 2022 and 2023 and can celebrate inflation levels returning to normal over the first half of this year.
“But, with the outlook for commodity prices remaining uncertain due to the impact of climate change on harvests domestically and globally, as well as rising geopolitical tensions, renewed inflationary pressures could be lurking just over the horizon.”
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