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Clothing and footwear prices continue to fall

Price pressure continued to affect clothing and footwear last month, with the two categories hardest hit by accelerating deflation.

Clothing and footwear deflation rose to 11.4% in May, up from 11.3% in April. The next category down was electricals, in which deflation decelerated slightly to 3.1% from 3.3%.

Overall non-food deflation grew to 2.8% from 2.7% in April, while the BRC/Nielsen Shop Price Index registered retail-wide deflation of 1.4%, meaning shop prices have fallen for the 13th consecutive month.

All fashion sub-categories experienced deflation in May, with kidswear and womenswear above the category average. Footwear, kidwear, menswear and babywear all experienced accelerated deflation. On a month-on-month basis, clothing and footwear prices fell 1% after a 0.8% drop in April.

Clothing deflation in May was below the three-month average of 11.8% but above the 12-month average of 10.2%.

Mike Watkins, head of retailer and business insight at Nielsen, said the next few months could offer a period of relative stability.

“Little in the way of immediate seasonal- or weather-related price increases is anticipated so the outlook for the next three months is for relatively stable shop price inflation,” he said. “Helped by the increases in consumer confidence since the start of the year, this should encourage shoppers to spend more freely over the summer months.”

The cost of living has eased for UK families as the average household had £170 a week of discretionary income in April 2014, up £3 a week year on year. The UK’s Office for Budget Responsibility (OBR) has forecast that real incomes will not return to 2008 levels until 2018 at the earliest.

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