Canny customers conspired to prevent retailers putting up their prices after the July sales, according to a new report.

The latest Shop Price Index, calculated by the British Retail Consortium, showed the average family's shopping basket was marginally cheaper during August than in July.

August's drop of 0.1 per cent followed a 0.4 per cent lightening of the load for consumers in July, when the effects of the summer sales kicked in.

Last month was also the 16th in a row which saw price cuts, the survey said, proving that there is intense competition for the consumer pound.

A basket containing 200 of the most commonly bought items now costs 2.04 per cent less than it did when the survey started in November 1997.

Bill Moyes, director general of the BRC, said: "These figures show just how price-aware customers have become.

"Retailers have not been able to put prices back up after the summer sales ended."