Competition between retailers seeking to entice customers with early Black Friday deals led to a slowdown in shop price rises during November, according to the British Retail Consortium (BRC).
The trade association for retailers said prices in shops rose by 0.6% last month compared with November 2024. This was down from a 1% rise in October and below the three-month average of 1%.
Black Friday has become one of the most important trading periods for many retailers, starting off the Christmas shopping season and giving shops an early insight into customers’ appetite for spending.
Originally a US phenomenon based around Thanksgiving at the end of November, it now encompasses a much wider period globally, with many retailers offering discounts from the start of the month.
Helen Dickinson, chief executive of the BRC, said: “Black Friday deals began earlier than normal [this year] as competition between retailers hit fever pitch.”
The BRC said discounting was most prevalent in the electricals, fashion, and health and beauty sectors, as retailers attempted to woo cash-strapped shoppers who continue to cut back on discretionary spending.
Recent surveys measuring consumer confidence showed a drop in November, as households have grown increasingly pessimistic about their spending, the labour market and the outlook for the UK economy.
Official figures from the Office for National Statistics (ONS) also revealed that UK retail sales fell 1.1% in October, a sharper drop than expected and the first decline since May.
However, Dickinson said retailers will be hoping consumer confidence rebounds during the vital winter trading period now that uncertainty around the budget is out of the way.
“They will continue doing everything they can to keep prices down and help customers’ money go further this Christmas,” she said.
The BRC also said food prices fell 0.3% month on month in November, after dropping at their sharpest rate in five years in October, at 0.4% month on month. However, on an annual basis, households are still feeling the pinch in their food bills, with prices rising 3% year on year.
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The BRC said inflation “remained stubbornly high” for oils and fats, as well as for meat and fish, as climbing production costs are passed on to customers.
“Retailers will need to keep any price increases as low as possible in the run up to Christmas, in order to entice shoppers to spend,” said Mike Watkins, head of retailer and business insight at market researcher NIQ.
The BRC figures cover the first week of November, making them more up to date than the latest official inflation figures, and will provide some optimism for those hoping for an interest-rate cut before the end of the year.
The rate of consumer price inflation fell for the first time in five months in October to 3.6%, according to the Office for National Statistics, increasing market bets that the Bank of England will cut interest rates from 4% to 3.75% at its next rate-setting meeting on 16 December.