Deflation in clothing and footwear in November increased to 5.5% from 5.3% in October as the category continued to put pressure on overall non-food deflation during discounting in the run-up to Christmas.
Overall shop price inflation edged up slightly in November to 0.2%, according to the BRC-Nielsen Shop Price Index.
Annual non-food deflation was 1.2% in November from 1.3% in October.
BRC director general Stephen Robertson said: “Many retailers are using special promotional days and online vouchers to stimulate consumer spending. A sharp increase in cotton prices, currently 72% up year-on-year, has yet to impact on clothing items so far this year. This could add inflationary pressure on clothing retailer’s during 2010.”
He said fierce competition at Christmas is keeping shop prices down as stores fight it out with discounts and promotions.
He added: “Low shop prices are contributing to reviving consumer confidence. Something the Chancellor should remember if he is considering piling new costs onto retailers in the pre-Budget Report. That would only fuel inflation.”
Nielsen senior manager of retailing services Mike Watkins said: “Shop price inflation is now stable but shoppers continue to be cautious about spending. As a result we are seeing more price cuts, deeper promotions and increased benefits from loyalty schemes in particular by the major food retailers. Christmas is a battle for shopper loyalty.”