Year-on-Year: The LRC-Nielsen Shop Price Index (SPI) for September shows that prices were 2.8% higher than at the same time a year ago. This is unchanged from the year-on-year inflation rate seen in August, keeping the inflation rate for the capital considerably higher than that of the UK as a whole.
September is now the seventh consecutive month to see prices rise year-on-year and, despite the slow down in the rate of inflation since July, remains high.
Month-on-Month: After showing a marginal rise of 0.1% between July and August, shop prices in the capital showed no change in September from August. This is in comparison to the UK, which saw a fractional 0.2% rise on August. Shop prices in London have now shown a month-on-month rise in nine of the last ten months.
Kevin Hawkins, Director General, LRC comments: “Although not as prolific as at the same time a year ago, promotional activity continues to be the main driver of demand and is needed to encourage spending. In a climate of price deflation and cost inflation, combined with a consumer that is reluctant to spend, retailers need all the assistance they can get. A rate cut now would provide this much needed help, and reassure consumers. ”
Mike Watkins, Senior Manager, Retailer Services, Nielsen comments: “With shop price inflation in London now back to the national average, retailers will be cautious about the impact on shoppers of any further price increases as consumer demand remains weak in non foods and unpredictable in foods”
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