British shop prices see first annual decline since October 2021, driven by summer sales, reveals survey
According to the British Retail Consortium, shop prices in the UK fell by 0.3% in August compared to the same month in 2023, following a 0.2% increase in July. Non-food goods experienced the largest drop in prices at 1.5%, while food prices increased by 2.0%, marking the smallest rise since November 2021.
Market expert Mike Watkins stated, "Shop price inflation has fallen again in August as many non-food retailers have kept promotional support due to the unpredictable weather." Additionally, food retailers have introduced more price cuts to drive incremental sales during the summer of sport events like the Paris Olympics and the men's Euro 2024 soccer tournament.
The Bank of England anticipates consumer price inflation to reach around 2.75% by the end of the year, before returning to the target of 2% in the first half of 2026. The recent interest rate cut by the BoE, along with expectations of further reductions, are key factors to watch in the coming months.