Retail prices expected to rise so shop now for bargains, says trade body
Trade body British Retail Consortium (BRC) told consumers they should shop now while prices are still low before they rise again.
Clothing and footwear prices fell 0.6% in May, but the pick-up in demand once social restrictions lifted meant this drop was smaller than in previous months as the 12-month average was 1.7%.
Furniture and electricals saw prices rise as retailers felt the lingering impact of global supply chain disruption from earlier this year.
Meanwhile, supermarkets fought hard to maintain market share and please thrifty customers by keeping prices low.
However, there are cost pressures on the horizon as global food prices are currently at their highest in seven years, shipping costs have risen threefold since 2019 and commodity prices are climbing.
Consumers will be seeing the impact of higher energy and fuel costs in household bills and whilst some cost price increases are coming through the supply chain, this is not yet enough for shop price inflation to return.
With high street retailers continuing to offer price reductions and supermarkets promoting seasonal food and drink, this is helping to offset cost of living increase, according to NielsenIQ, which compiles the shop price index.
“We will likely see these costs filter through in the second half of this year, and with the additional Brexit red-tape this Autumn, retailers may be forced to pass on some of these costs onto their customers,” said BRC chief executive Helen Dickinson.
“Government can help to ease the burden on British consumers by finding ways to minimise the impact of new checks and documentation required from October.”