UK shop prices fall at faster pace in August, but pressures ahead

British shop prices fell at a faster rate in August, although the weak pound could start to feed through to retailers in the months ahead, an industry survey showed on Monday.

Shop prices fell 2.0 percent in August compared with 1.6 percent in July, according to the British Retail Consortium (BRC).

Food prices fell at the fastest pace on record, dropping 1.1 percent from 0.8 percent.

"The devaluation of sterling in wake of the referendum will put upward pressure on shop prices," said BRC Chief Executive Helen Dickinson.

"But that's likely to take several months to properly feed through, given that retailers won't feel the brunt of the cost increases until existing contracts with foreign suppliers come to an end."

Sterling hit a one-month high on Friday, topping $1.33 but it is still about 11 percent below its level against the dollar before the June 23 vote to leave the European Union.