UK shop price decline quickens in October - BRC
LONDON (Reuters) - British shops matched a record decline in the price cuts in October and food prices looked at risk of falling into deflation, a survey showed on Wednesday.
The British Retail Consortium said October retail prices were 1.9 percent lower than a year ago, matching July's record decline and weaker than a 1.8 percent fall in September.
Prices for food products edged up just 0.1 percent, the smallest rise since the survey began almost eight years ago, compared with a 0.3 percent increase in September. There was deep and widespread discounting across grocery stores.
Mike Watkins, head of retailer and business insight at survey compiler Nielsen, said shoppers had been helped by a fall in global food prices over the last six months. "With sales volumes at an historic low point for food retailers, there is now a risk of food deflation on the horizon."
Britain's big supermarkets have fought an escalating price war, spurred by discounters like Aldi and Lidl which have taken a growing market share from traditional rival grocers.
Overall, consumer price inflation ran at 1.2 percent in September, well below the Bank of England's 2 percent target.
Wages are growing even more slowly - something the BoE has cited as a reason to keep interest rates on hold.
The BRC survey is designed to reflect price changes in shops in 500 of the most commonly bought high street products.
(Reporting by Andy Bruce; editing by William Schomberg/Jeremy Gaunt)
