Food Prices At Record Low Last Month In UK Despite Brexit Fear

Food prices hit a record low last month in the United Kingdom and shoppers enjoyed falling prices and retailers continued with the offers and discounts, reveals the latest British Retail Consortium (BRC)-Nielsen study.

The study further adds overall shop price deflation was 2 percent in the month of August and in July it was 1.6 percent decline.

Shop price index point falling cost of oil and more promotions from retailers were the reasons for record low.

The non-food deflation hit the country by 2.5 and 2.2 percent in August and July respectively.

Following the referendum favouring Brexit the pound value plunged and retailers are yet to feel the full force of the rising costs.

Meanwhile, BRC chief executive Helen Dickinson said prices may rise in near future when the costs are gradually passed down to consumers.

Dickinson added, “The devaluation of sterling in wake of the referendum will put upward pressure on shop prices… But that’s likely to take several months to properly feed through, given that retailers won’t feel the brunt of the cost increases until existing contracts with foreign suppliers come to an end.”

However, he cautioned the retailers need to make a decision then like how to pass onto consumers and when.

Despite Brexit uncertainty in the country, spending has remained buoyant. The retail sales jumped 1.4 percent in July even though economists estimated it to be much low.

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