Consumers have benefited from three years of continuously falling shop prices on non-food goods, according to the latest data from retailers.
Excluding food, prices fell 2.6% in March from a year earlier, according to the BRC-Nielsen shop price index.
It was a slower rate of annual deflation than February, when non-food prices fell by 3%, but it was the 36th month of consecutive falls as consumers continue to shop around for bargains.
Helen Dickinson, chief executive of the British Retail Consortium, said: “Despite consumer confidence remaining at zero, a relatively benign economic environment and a fiercely competitive market will see retailers continue to respond to their customers with prices and promotions to maintain market share as the spring season kicks off.”
Deflation deepened in footwear, men’s clothing, children’s clothing and babywear, as well as furniture and carpets. Annual food deflation was 0.4% in March, unchanged from February. Fresh food was the driver of the price falls, with the cost of fruit, milk, cheese, eggs, meat, vegetables and oils and fats all lower than a year earlier. Ambient food prices rose, driven higher by bread, cereals and alcohol.
Mike Watkins, head of retail and business insight at Nielsen, said: “Shoppers are still making changes to how they spend to stay within their household budget and looking out for price cuts and promotions is one of the ways to save money.
“So with shop prices continuing to be lower than a year ago this is good news for shoppers. With spring arriving, retailers will be hoping that this drives store traffic, as so far this year retail sales have been rather unpredictable.”
Overall shop prices – including both food and non-food – fell by 1.7% in March compared with a year earlier. That was a slower rate of deflation than February when annual prices were down 2%.
Falling shop prices reflect weak inflation in the wider UK economy. Annual inflation was 0.3% in February according to the Office for National Statistics, unchanged from January.
