February Shop price deflation deepened to 0.8% in February from 0.5% in January. Shop Prices have been reported to be deflationary for 58 months now. 

Deflation in Non-Food prices deepened in February, with prices decreasing at a rate of 2.2% compared to January when prices declined by 1.9%. This was the deepest deflation since April 2017.

Chief Executive of the British Retail Consortium, Helen Dickinson OBE said: “Shop Prices dipped deeper into deflationary territory in February. 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.

“While it’s good news that earnings and inflation are heading in the right directions for consumers, retailers can expect to see more of the same, tough trading environment over the coming months. With that in mind, it’s imperative we get clarity and a definitive agreement over the next month’s Brexit negotiations around the exact form of the transition arrangements. Both the transition and the UK’s future relationship with the EU will determine how we maintain consumers’ current access to a diverse choice of affordable goods.”

Head of retailer and vusiness insight at Nielsen, Mike Watkins said: "With structural changes in the non food retail landscape accelerating and consumers remaining cautious about discretionary spend, non food prices are still deflationary.”