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BRC-Nielsen shop price index June 2010 - shop price volatility: 'Over for now'

7 July 2010

Overall shop price inflation slowed to 1.5% in June from 1.8% in May. Food inflation slowed to 1.7% in June from 2.2% in May. Non-food inflation slowed to 1.4% in June from 1.6% in May.

Stephen Robertson, British Retail Consortium director general, said:

"The era of shop price volatility seems over for now. Low and stable inflation appears likely for the rest of the year.

"The fluctuations in commodity costs and exchange rates over the last 18 months have now fed through. Barring any major shocks, we're not expecting sharp movements in price.

"Overall shop price inflation slowed slightly from May. Food inflation fell, largely because fresh food such as fish and vegetables were cheaper than a year ago.

"Non-food items, including electricals and clothing, continue to be cheaper than they were this time last year.

"In the face of weak demand, retailers will continue to use widespread discounts and promotions. But, given their thin margins, there will be little scope to absorb next year's VAT increase. This will put significant pressure on inflation from January onwards."

Read the shop price index June 2010 in full here:
http://www.brc.org.uk/showDoc04.asp?id=4104&moid=7051



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British Retail Consortium

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