Annual shop price inflation almost halved in March, according to new industry data.

Falling food costs and competition among retailers led to rates falling to 1.3% last month – down from 2.5% in February, British Retail Consortium (BRC)-Nielsen Store Price Index found.

Annual store price growth is now at its lowest level since December 2021, the data shows.

The report also found that food prices rose 3.7% year-on-year, down from 5% in February.

inflation Spending on products other than food fell to 0.2% in March, down from 1.3% the previous month.

BRC chief executive Helen Dickinson said: “While Easter dinner More expensive Prices fell from last month as retailers offered special offers on popular chocolates amid higher global cocoa and sugar prices compared to previous years.

“Dairy prices also fell this month as farm gate prices fell and retailers worked to reduce prices on many essential items.

“On the non-food front, prices fell in appliances, clothing and footwear as retailers stepped up promotions to attract consumer spending.”

However, she warned Retailer There are significant pressures in the coming months, including rising business rates and new border checks, which “could put progress in lowering inflation at risk”.

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“Inflation continues to slow, with the main driver this month being further declines in food prices,” said Mike Watkins, director of retailer and business insights at NielsenIQ.

“A year ago, food inflation was 15%, so that’s to be expected.

“But it’s also helped by fierce competition among supermarkets as they look to boost footfall, with concentrated price cuts and promotional offers in the weeks leading up to Mother’s Day earlier this month and now Easter.”

This comes after official data recently released headline inflation rates Slowed to 3.4% in FebruaryFood prices are said to be a major factor in the decline.