By Daniel Hunter

Retail shop prices fell for a 27th consecutive month in July, according to the latest Shop Prices Index from the British Retail Consortium (BRC) and Nielsen.

Overall shop prices were down 1.4% in July compared with the same period last year. It follows a deflation of 1.3% in June.

Food prices crept up slightly by 0.1%, but non-food items fell by 2.3%, faster than the 1.9% decrease seen in June.

BRC Director General, Helen Dickinson, described the continued fall in prices as "good news for consumers".

She said: “In the three months to July, food prices fell by 0.4% as the impact of past falls in oil but lower commodity prices and weaker demand in emerging markets helped support a continued deflationary environment. Annual food prices did rise very marginally this month, by just 0.1% year-on-year, this is a short-term blip in the longer term downward trend, reflecting the on-going heightened levels of competition and it is not very significant.

“July marked the 28th month of falling non-food prices. Clothing retailers were keen to shift their summer stock with widespread discounts clearly part of their strategy. Prices throughout this category fell on average by 4.9%. Furniture and Flooring saw a sharp acceleration in deflation to 2.7% as retailers attempted to capitalise on stronger levels of demand in this category from renewed strength in the housing market.”