Shop price Inflation slow in Jan

07 Feb '08

2 min read

Year-on-Year: In January London saw shop price inflation slow to 2.5% on a year-on-year basis, from the 2.9% annual rate seen in December. This is the third consecutive month inflation has fallen and, while still relatively high compared to the UK as a whole, it is at its lowest rate since June 2007.

Month-on-Month:
On a month-on-month basis shop prices fell by 0.4% after rising 0.4% in December. The traditional January sales kept prices down, with many retailers discounting heavily. This is the first time London shop prices have fallen month-on-month since July 2007 when summer sales led to a fall in the monthly rate of inflation.

The BRC's new Director General, Stephen Robertson, said:
“London retailers continued to discount heavily into the New Year to entice cash-strapped customers to spend. In January, year-on-year shop price inflation in the capital fell to its lowest rate in seven months. With prospects for the South East economy looking tough, the Bank of England must act now to build reviving rate-cut momentum before it's too late.”

Mike Watkins, Senior Manager, Retailer Services, Nielsen comments:
“Retailers in London are still reliant on discounts to bring in shoppers and, with disposable incomes under increased pressure this month, this consumer caution is reflected in a modest increase in overall prices by retailers in January - increases which are less than the headline RPI.“

British Retail Consortium

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