Dec. 7 (Bloomberg) -- U.K. shop-price inflation slowed in November to the lowest in a year as a supermarket price war curbed food-cost increases, the British Retail Consortium said.
Retail prices rose 2 percent from a year earlier, down from 2.1 percent in October, the trade group and Nielsen Co. said in an e-mailed report in London today. A separate report from KPMG LLP showed hiring for full-time jobs dropped the fastest since July 2009.
Bank of England Governor Mervyn King said last month that inflation will slow through 2012, helping to support consumers as the debt crisis in Europe undermines the outlook for growth. Policy makers will probably leave their bond-purchase facility at 275 billion pounds ($430 billion) and their key interest rate at a record low tomorrow to bolster the recovery.
“It’s been a slow start to Christmas trading and many retailers have reduced prices further in recent weeks,” Mike Watkins, senior manager of retail services at Nielsen, said in the statement. “The outlook for inflation is however much more positive than this time last year and shop-price inflation is expected to fall further in the first part of 2012.”
Food prices gained an annual 4 percent, down from 4.2 percent in October, while inflation on non-food goods remained at 0.8 percent, today’s report said. On the month, food prices were unchanged after falling 0.5 percent in October.
KPMG and the Recruitment and Employment Confederation said an index of hiring of full-time staff fell to 48.2 in November from 49.7 the previous month. A measure of demand for temporary staff dropped to 50.9 from 52. Readings below 50 indicate a contraction.
King said a press conference last month that inflation is set to slow “sharply,” and in the absence of a spike in commodity prices, “the extraordinary squeeze on real take-home pay that we’ve seen in the past three years should now begin to come to an end,” easing pressure on consumers.
--With assistance from Scott Hamilton in London. Editors: Fergal O’Brien, Andrew Atkinson
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