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Price squeeze grips retailers in February

Discounting from struggling retailers in February triggered outright deflation across swathes of the high street for the first time in more than two years, the British Retail Consortium (BRC) said yesterday.

The BRC's latest shop price index painted a grim picture of hard-pressed consumers willing to spend money on essentials such as food but little else.

Prices among non-food retailers were down 0.7 per cent year-on-year – the first instance of outright decline since November 2009 – with clothes, electrical goods and furniture all cheaper than this time last year.

The slide drove shop price inflation down from 1.4 per cent to 1.2 per cent in February, the lowest for nearly two years.

Higher petrol costs were blamed for rising food prices, which rose 4.2 per cent year-on-year in February.