MNI: UK September Shop Prices Up For 2nd Straight Month: BRC

--UK Shop Prices Up 0.2% y/y, Following August's 0.1% Rise

By Jai Lakhani

     LONDON (MNI) - After 63 months of UK shop price deflation up to July,

prices rose for a second consecutive month in September, rising by 0.2% y/y,

following a 0.1% rise in August, the British Retail Consortium (BRC) survey

published Wednesday showed. 

     September's m/m rise of 0.1% and 0.6% in August marks the first time in

five years there has been two consecutive monthly of price gains. 

     On an annual basis, the BRC Shop Price Index (SPI) was up 0.2%, compared to

a rise of 0.1% y/y in August.

     Food price inflation, which accelerated to 1.9% y/y in August, remained

steady in September at 1.9%. As fresh food inflation ticked up to 1.6% in

September, ambient food inflation directly offset this by lowering to 2.4% in

September from 2.5% in August. 

     Food prices were stoked by the global commodity conditions, in particular

oil prices, which suggest there could be increased inflationary pressures ahead.

     Non-food prices continued to decline, as the pace of deflation moderated to

-0.9% from -1.0% in August. This was down to retailers less aggressively

discounting. 

     The SPI covers only a slice of the UK consumer price basket, with the

non-food element of the index covering some of the same ground as core goods

inflation in the official data.

     Helen Dickinson, Chief Executive at the British Retail Consortium points to

concerns over Brexit on food price inflation. "Food prices alone have now been

inflationary for more than a year and the BRC estimates that consumers could

face up to a 29% increase in prices of products such as beef in the event of a

"no-deal."

--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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