The UK annual inflation measured by the Retail Prices Index has for the first time since 1960 today revealed that the UK economy is in a state of deflation – but video games remain one of the few categories increasing in price.
The BBC reports that the RPI fell to -0.4 per cent in March, down from the zero growth it reported in February.
However, whilst the Office for National Statistics reported dropping prices from energy companies had forced the index down, video games joined clothes, toys and hobbies in actually increasing in cost over the previous month.
We suspect that the weakness of retail spending and activity in general will bear down strongly on core inflation in time,” Capital Economics’ Jonathan Loynes explained.
UK inflation is still set to drop a lot further and the threat of a broader bout of deflation has not evaporated.”