Shop prices fall for first time in nearly three years

Fresh food inflation, such as fruit, meat and fish, had seen the biggest monthly decrease since December 2020, it said, thanks to falling costs from suppliers.

But the BRC said non-food retailers had been “discounting heavily to shift their summer stock, particularly for fashion and household goods”.

“This discounting followed a difficult summer of trading caused by poor weather and the continued cost of living crunch impacting many families.”

The BRC said prices of non-food goods were 1.5% lower in August than they had been a year ago. Food prices were up 2%, but this was down from July’s figure of 2.3%.

BRC chief executive Helen Dickinson said that while households will be “happy” to see the prices of some goods falling, there was no guarantee this trend would continue.

“The outlook for commodity prices remains uncertain due to the impact of climate change on harvests domestically and globally, as well as rising geopolitical tensions,” she said.

“As a result, we could see renewed inflationary pressures over the next year.”