[LONDON] The fall in British shop prices picked up more speed in September, the British Retail Consortium said on Wednesday, underscoring the weak outlook for the country's zero inflation rate.

The BRC said shop prices in September were 1.9 per cent lower than a year earlier, a bigger fall than August's 1.4 per cent decline. Food prices fell 0.5 per cent having pushed up marginally in the previous two months.

"Within food retailing, there is still downward pressure on prices and this is expected to continue as supermarkets battle for the wallets of the Christmas shopper," Mike Watkins, head of retailer insight at survey compiler Nielsen, said. "On the high street, many non-food retailers are using strong, seasonal promotions to drive sales growth."

Non-food prices also fell more quickly, down by 2.9 per cent in September.

Britain's broader official measure of inflation, the consumer prices index, slipped back to zero in August.

The Bank of England, which is expected to keep interest rates at a record low this week, expects inflation to pick up next year.

REUTERS