Shop Price Index
Weak demand forces further promotions
Helen Dickinson OBE, Chief Executive, British Retail Consortium:
“Consumers will welcome the fall in shop prices, which accelerated from the previous month, with non-food prices falling at their highest rate since May 2018. This decline was driven by weak consumer demand and intense competition, which led many retailers to prolong their January sales. In contrast, some non-perishables, such as cereals, have caused overall food prices to rise. This is likely to worsen as global food prices have been growing at a double-digit rate for the past three months.
“There are currently huge cost pressures bearing down on retailers, including business taxes, the Apprenticeship Levy and rising wages. The upcoming Budget presents an excellent opportunity to address the broken business rates system, starting with transitional relief, which has forced retailers to subsidise other industries by nearly £500 million since 2017.”
Mike Watkins, Head of Retailer and Business Insight, Nielsen:
"Whilst there was a slight increase in food prices this month, this is not going to change how we shop or what we buy, as the wider concerns that consumers have about their own finances continue to make them cautious about spending. But if consumer price inflation increases further over the next few months and if sales growths remain weak, then more retailers may need to compensate with extra promotions and deeper price cuts.“