Food price inflation 'lowest in 3 years'

Thursday, 08 April 2010 10:17

By myfinances.co.uk staff

The annual rate of inflation on food prices fell to its lowest level in three years during March, according to the latest figures from the British Retail Consortium (BRC) and Nielsen.

Upward pressure on the cost of produce fell from 1.3 per cent in February to 1.2 per cent last month. This was the first time the rate had shown a decline since VAT returned to 17.5 per cent at the start of the year.

Meanwhile, annual price inflation on non-food products slowed from 1.9 per cent to 1.3 per cent.

Overall, shop price inflation dropped from 1.7 per cent in February to 1.2 per cent in March.

BRC director-general Stephen Robertson said that the figures are "great news" for consumers.

"The competitive battle is even fiercer than usual as retailers fight it out to overcome the reluctance of customers to spend caused by pre-election uncertainty," he commented.

Mr Robertson added that lower shop prices will provide "welcome relief" to consumers facing sharp increases in other living costs, such as fuel prices.

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