Retail prices slide for record 31st month

Shop prices slumped by a record level last month, driven down by the supermarket price war and fierce competition across the rest of the high street, according to the latest British Retail Consortium/Nielsen Shop Price Index.

The supermarket price war has driven retail prices down. Picture: Contributed

It found that retail prices fell by 2.1 per cent in the year to November compared to a year ago, a joint low with March this year.

The fall follows a plunge in prices of 1.8 per cent in October, and the November drop marked the 31st consecutive month of falling retail prices.

The data, which covers 9 to 13 November, does not cover the Black Friday sales period, although the survey said retailers cut prices across the month in the run-up to the weekend.

It said non-food shop prices fell by 3.3 per cent over the period, driven by reductions in clothing, footwear, electricals, DIY, gardening and hardware.

Under-pressure supermarkets saw prices fall by 0.3 per cent, as raw commodities like coffee, soyabean and cattle feed suffered double-digit declines over the last 12 months.

British Retail Consortium director general Helen Dickinson said the fall in food prices came “as the impact of past falls in oil, weaker demand in emerging markets and a strong pound helped support a continued deflationary environment”.

She added that government announcements made since the general election in May, such as the introduction of the national living wage in April, will cost retailers around £14 billion between now and 2020. Dickinson said: “This trading environment should be considered with the impact of the industry’s regulatory burden.”

Mike Watkins, Nielsen’s head of retailer and business insight, said shoppers had enjoyed falling sales “for the best part of two years”. He added: “Falling prices across the high street and food retailers in November will be another welcome boost for shoppers as they plan their Christmas spending.”