Clothing and footwear were among the items contributing most to the decline in annual store price inflation in April, as pressure on UK consumer spending continues to ease.

Shop price inflation fell to 0.8% in April from 1.3% in March, below the three-month average of 1.4%, new figures from the British Retail Consortium show. Annual shop price growth is the lowest since December 2021.

The non-food industry was in deflationary territory, losing 0.6 percent in April after rising 0.2 percent in the previous month. This is below the three-month average of 3.9 percent. Inflation is at its lowest level since March 2022.

The declines in clothing and footwear were due to retailers increasing promotions to stimulate consumers’ willingness to buy, said Helen Dickinson, CEO of the NRC.

Meanwhile, food inflation slowed for the twelfth consecutive month to 2.4%, from 2.6% in the previous month, as prices of fresh products such as butter, fish and fruit continued to fall due to falling input costs and intense competition among food retailers.

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Inflation for non-perishable food also slowed to 4.9% in April, from 5.2% in March. This is below the three-month average of 5.6% and the lowest since June 2022.

“While consumers will welcome lower inflation in retail prices, geopolitical tensions and the resulting impact on commodity prices, such as oil, pose a threat to future price stability,” Dickinson said.

The new data will be of some comfort to the Bank of England, which is under pressure due to historically high interest rates. The base rate is currently at 5.25 percent, after the central bank has raised its base rate 14 times in a row. The central bank is trying to get a grip on exploding prices while also stimulating the economy.

A look at inflation showed that it has fallen less than expected. This prompted investors in the City to lower their forecasts for the Bank of England’s rate cut this year. Traders are now pricing in just one rate cut this year, compared to five rate cuts expected in early 2024.

Britain’s annual inflation rate fell for the second month in a row in March, falling to 3.2 percent – the lowest level since September 2021. The core indicator, which excludes volatile elements such as energy, food, alcohol and tobacco, fell to 4.2 percent from 4.5 percent in February.

However, both figures are above expectations, as the market had expected a consumer price index (CPI) of 3.1% and core inflation of 4.2% for March.

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