June saw biggest fall in food prices for a year

Last month, the prices of groceries fell the sharpest they have decreased in more than a year, with overall shop prices falling for the 38th consecutive month.
There was a 0.8 per cent decrease in food prices in June, continuing on from the 0.3 per cent fall in May, figures from the British Retail Consortium (BRC) Nielsen Shop Price Index revealed. They represent the period of time before the EU referendum, in which the UK voted to leave.
Overall shop prices fell 2 per cent last month, a slight increase on the 1.8 per cent decrease in May.
Helen Dickinson, chief executive of BRC, said: “This month’s figures show overall shop prices falling once again. This extraordinary 38-month run of deflation has undoubtedly been good for consumers. While the good news for household budgets continues, prices in store will eventually rise again.
“However, the time it takes for any price increases to make a reappearance will depend on a combination of factors, including the future value of the pound, commodity prices and any eventual impact of last week’s Brexit vote on input costs.”
The BRC expects prices to rise again eventually, despite the intense supermarket price-war. The vote to leave the EU, and the sharp fall in the value of the pound, means that in the longer term there may well be higher food costs for shoppers, as it retailers face higher costs to import goods.