Falling shop prices eased in August to 1.6% from 1.9% in July, as retailers continue to keep prices low in the summer months.
It is the sixteenth consecutive month of falling shop prices, according to the British Retail Consortium (BRC) Nielsen Shop Price Index, but the slow-down in deflation broke a four-month sharp down-wards trend.
Food inflation remained at 0.3%, the same rate as last month and the lowest ever recorded.
And non-food inflation slowed to 2.9% in August from 3.3% in July.
BRC director-general Helen Dickinson said: “The summer months saw retailers provide plenty of attractive offers on fresh food goods, which saw their lowest level of inflation this year, with vegetables, fish and also milk, cheese and eggs contributing to the downward pressure.
“Big-ticket goods that we tend to associate with the summer, gardening, electricals, DIY, furniture and floorcovering, helped to sustain low prices.
“What’s more, as the UK economy continues to pick up, the benefits of subdued cost increases – oil and commodity prices remained relatively flat over the first half of the year – incurred by retailers will be passed on to customers.”
Nielsen head of retailer and business insight Mike Watkins added retailers are set to keep prices down to keep consumers coming into stores after the summer holidays against a difficult back drop.