Store wars see prices drop for 22nd month

Shop prices have dropped for the 22nd month in a row as retailers battle to win over consumers, according to a report released today.

Lidl is providing the major supermarkets with a challenge. Picture: Jane Barlow

The data, from the British Retail Consortium (BRC) and researcher Nielsen, found the fall in prices accelerated to 1.7 per cent last month, compared with a decline of 1.3 per cent in January.

BRC director-general Helen Dickinson said: “Food prices fell for the second month in a row, as fresh food edged down to its lowest level on record with milk, cheese, eggs, vegetables and convenience food all cheaper than they were a year ago.”

As the major supermarket chains cut prices in a bid to fend off the challenge from discount rivals Aldi and Lidl, the fresh food category dropped by 1.2 per cent in February, from 1 per cent the previous month.

Mike Watkins, head of retailer and business insight at Nielsen, said shoppers were enjoying a “double benefit” of price cuts and promotional offers.

Non-food areas such as clothing and footwear, gardening and home improvements also experienced deeper deflation, while there was a slowdown in the rate of price increases for books, stationery and home entertainment.

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