The UK's British Retail Consortium's (BRC) shop price index for September showed a rise of just 0.11 per cent from last year, compared with 0.32 per cent in August.
According to the index, shop prices rose by 0.77 per cent in the month of September, following two months of declines.
The index now stands at the same level as in May, with the prices of non-food items increasing as a result of the end of the summer sales and the introduction of new season ranges into stores.
"Although on a monthly basis, prices bounced back a bit, following two months of falls, shop-price inflation is still well below the general rate of price increases and shows how competitive shops are," said BRC director-general Mr Bill Moyes.
"With our figures showing no sign of the high street overheating, the MPC [Monetary Policy Committee] has plenty of scope to lower interest rates".
The latest index was released just before the MPC was due to give its latest verdict on interest rates following its regular October monthly meeting.
Most economists expect it to trim rates by a quarter of a point to 4.50 per cent when it announces its decision at noon.