In November, shop price deflation was recorded at 0.6%, a slight decrease from 0.8% in the previous month.
- The BRC-NielsenIQ Shop Price Index indicated a small shift above the three-month average rate of -0.7%.
- Non-Food prices continued in deflation at -1.8% for November, representing a marginal increase from -2.1% in October.
- Food inflation showed a minimal decrease, going down to 1.8% from October’s 1.9%.
- Potential future cost increases may result from upcoming changes in Employers’ National Insurance Contributions and other factors.
The latest data documents a minor alteration in shop price deflation, which stood at 0.6% in November, a drop from the previous month’s 0.8% according to Winifred Okocha. The BRC-NielsenIQ Shop Price Index has shown that this figure is slightly above the three-month average of -0.7%. Helen Dickinson, CEO of the BRC, noted that this marked the first time in 17 months there was an increase in shop price inflation over the previous month, although it remained in negative figures.
Non-Food categories saw continued deflation at a rate of -1.8% in November, up from -2.1% in October. This rate surpasses the three-month average of -2.0%. Various sectors such as fashion and furniture maintained numerous bargains, with retailers limiting their discount strategies. Furthermore, early Black Friday sales provided consumers with advantageous deals, particularly in the electronics segment.
Food prices highlighted a minor shift with inflation decelerating to 1.8% in November from 1.9% in October. Such trends have not been observed since mid-2021, indicating a potential stabilisation in market pricing.
Helen Dickinson, addressing upcoming economic challenges, warned of significant price pressures anticipated in the near future. The retail sector might incur an additional £7 billion in costs in 2025 due to changes in Employers’ National Insurance Contributions, adjustments in business rates, minimum wage increments, and an impending packaging levy. Retail margins, already limited, could suffer from these added costs, likely pushing prices upwards unless governmental interventions alter existing plans and timelines.
The current trends in deflation reveal ongoing bargains in fashion, yet highlight looming economic pressures that could disrupt this pattern.
