FX.co ★ UK Shop Price Inflation Softens To Near 2-Year Low

The British Retail Consortium has reported that the UK's shop price inflation dropped to a near two-year low in February. The shop price index rose by 2.5 percent on an annual basis for the month, marking a descent from January's increase of 2.9 percent.

This rate was the lowest since March 2022, falling below the three-month average of 3.3 percent. Reports also showed that non-food inflation remained consistent at 1.3 percent - a rate not seen since January 2022.

Meanwhile, food inflation fell from 6.1 percent in the previous month to 5.0 percent, marking its lowest point since May 2022. Similarly, fresh food pricing saw a less dramatic growth of 3.4 percent compared to the previous 4.9 percent rate increase.

Mike Watkins, the head of retailer and business insight at NielsenIQ, suggested that shop price inflation trends could be expected to decline over the ensuing months. Watkins underscored the importance of maintaining stable prices for high street retailers in the face of weakening demand, as it may incentivize customers to continue spending.