MNI: UK Shop Price Deflation Picks Up In Feb - BRC

--UK Feb Shop Prices -0.8% y/y Versus -0.5% In Jan

     LONDON (MNI) - UK shop prices rose on the month in February, but deflation

accelerated on an annual basis, data from the British Retail Consortium showed.

     The BRC shop price index rose 0.4% on the month in February but prices fell

0.8% on the year, picking up from the -0.5% seen in January.

     Food price inflation slowed, while non-food deflation picked up. Food

inflation year-on-year fell to 1.6%, down from 1.9% in January, which was the

highest such reading since October 2017. The BRC's non-food Shop Price Index

(SPI) fell to -2.2% on the year from -1.9 last month%, the deepest rate of

deflation since April 2017.

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

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

inflation in the official data. 

     The data overall are consistent with the picture of UK inflation likely

having peaked, with headline CPI coming in  at 3.0% in January, unchanged on

December's reading with most analysts expecting it to head very gradually lower

in coming months.

     "This is a further sign that we have passed the peak of the upward pressure

on inflation caused by the fall in the pound in June 2016. This will ease the

squeeze on consumer incomes over the coming year, but it's likely to do little

to lift the rate of growth in consumption. Earnings are still falling in real

terms, despite wages increasing, and savings are unlikely to provide the same

support to spending that they have over the last 18 months," said Helen

Dickinson OBE, Chief Executive, British Retail Consortium.

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

--MNI London Bureau; +44 203-586-2226; email: jamie.satchithanantham@marketnews.com

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