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UK shop price inflation slows to 1.4 pct in April

Published 05/05/2009, 07:01 PM
Updated 05/05/2009, 07:08 PM

LONDON, May 6 (Reuters) - British shop price inflation slowed markedly in April as food price inflation dropped for the first time this year, the British Retail Consortium said on Wednesday.

A steadier pound and increased promotional activity pushed annual shop price inflation to 1.4 percent last month -- its lowest since January -- from 2.0 percent in March, the lobby group said. "There's some good news about prices in these figures," said Stephen Robertson, British Retail Consortium Director General.

"The worst of food price inflation may be over, thanks to a more stable value for the pound," he added.

Sterling has stabilised over the past two months, having lost a quarter of its value in trade-weighted terms <=GBP> in the previous 18 months.

The BRC said annual food price inflation eased to 7.9 percent in April from 9.0 percent in March. Non-food price inflation fell to 1.9 percent from 1.5 percent in March.

Shop prices fell 0.5 percent on the month, the first month-on-month fall this year.

The strength of food price inflation and rising import prices meant consumer price inflation was surprisingly sticky at the start of the year but official figures showed it eased to 2.9 percent in March from 3.2 percent in February.

(Reporting by Christina Fincher; editing by Stephen Nisbet)

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