Deflation deepens while grocery prices continue to rise

Woman shopping

Shop prices fell by 1.1% in May 2018 compared to the same month last year, according to the latest BRC-Neilsen Shop Price Index.

This is the 61st month of falling Shop Prices and the deepest deflation since January 2017.

Deflation in Non-Food prices deepened further in May, with prices 2.5% lower than the same month in 2017. This is the deepest deflation in Non-Food since August 2016.

This was offset somewhat by continued rising grocery prices, with Food inflation up in May to 1.2%, from 1.0% in April. Ambient Food inflation accelerated in May to 1.7%, from 1.2% in April. Fresh Food inflation was unchanged at 0.9% in May.

Commenting on the figures, David Lonsdale, Director of the Scottish Retail Consortium, said: “Falling prices at shop tills is great news for consumers and this will hopefully tempt more folk onto Scotland’s high streets and retail destinations.

“Shoppers are benefiting from intense competition amongst retailers which is helping to keep down prices on shop shelves, welcome news at a time when family finances overall continue to be under strain due to weak real wage growth, higher taxes and other domestic costs.”