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Sancho Panza

Shop Prices Fell For The 18Th Consecutive Month In October

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Telegraph 5/11/14

'Prices for fresh foods including milk, cheese and vegetables fell at the steepest rate for at least eight years last month, helping to push down overall shop prices amid a supermarket price war and fierce competition on the high street.

The overall price of items fell by 1.9pc in October compared with a year ago, according to the British Retail Consortium (BRC). This marks the 18th consecutive decline and the joint-steepest rate of deflation since records began in 2006.

Fresh food prices fell by a record 0.4pc in October, representing the first decline in prices since February 2010, while the overall price of food also edged closer towards deflation, growing by just 0.1pc compared with last October.

Prices at DIY and gardening stores suffered their deepest level of deflation since our records began, while clothing and footwear prices continued to decline at close to double-digit rates.

Experts said falling prices would give shoppers a boost in the run-up to Christmas, while falling commodity prices would help to keep shop prices down in the coming months.

“With a backdrop of falling commodity prices, cheaper imports and benign inflationary pressure in the supply chain, we expect the great deals to continue in the medium term bar any supply chain shocks," said Helen Dickinson, director general of the BRC.

‘’With the current competitive environment, retailers are passing most of these savings on to consumers. As Christmas swiftly approaches, there is plenty of evidence to suggest that budgets will go a little bit further this year’.’

Inflation fell to a five-year low of 1.2pc in September, according to the Office for National Statistics. The BRC expects inflation, as measured by the consumer prices index, to decline further over the coming months as lower oil prices translate into cheaper fuel and petrol costs.

The BRC said this would help to support strong consumer spending growth, which has been the main driver of the recovery.

"Weak inflation, further jobs growth, stronger earnings growth and low inflation expectations should all support the recovery in consumer spending through the rest of this year," it said.'

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Some way to go before prices of EU supermarket goods match the price of those in other 3rd rate countries like India and China. Globally prices will even out with a small difference for fixed overheads.

Onions in India are 29p per kilo - ASDA are charging 40p/kg by the 5kg bag.

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Take note:

- Central banks are not panicking.

- They are not emergency printing to avoid 'deflation'

-- The only deflation they care about is asset deflation --

It's clear proof for all to see, only last month Carney was talking about raising rates.

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And this is with the current 'deficit reduction'. I don't think they can close the deficit as wouldn't this lead to deflation ? As in the Eurozone where shops have to slash prices to increase demand.

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So, stuff in shops dropped by about 2% and fuel is down by about 10%.

How in god's name are the CPI figures still at +1.2%?!

Price inflation of private school fees, skiing holidays and golf club subscriptions.

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  • 407 Brexit, House prices and Summer 2020

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