Inflation in UK shops slowed in April, marking its slowest rate since December 2021, according to the latest data from the British Retail Consortium (BRC).
The easing inflation comes as clothing and footwear retailers offer deep discounts to move summer stock – a result of cooler and wetter weather. In this week’s blog, we’re taking a close look at what this means for high streets and what the landscape could look like in the coming months.
The retail landscape
The BRC’s report indicates that non-food prices fell at an annual rate of 0.6% in April. Along with lower prices of summer products – this drop is also credited to aggressive marketing campaigns launched by retailers to encourage consumer spending.
Food prices continue to rise but the rate of increase is slowing down. The annual increase in food prices stood at 3.4% in April, down from 3.7% in March. This easing can be attributed to declining input costs and intense competition among grocers, leading to price reductions in fresh products such as butter, fish and fruits.
What this means for consumers
While the overall shop inflation has dropped to 0.8% in April (compared to 1.3% in March), food prices are still significantly higher than they were before Russia’s invasion of Ukraine. Consumers are facing a 25% increase in food costs since early 2022, highlighting the lingering impact of global events on local prices.
Helen Dickinson, the BRC chief executive, noted that while inflation is slowing, geopolitical tensions and adverse weather conditions could still pose risks to price stability. Farmers are warning of potential food shortages due to months of wet weather, which could lead to renewed price hikes.
Despite the best efforts to retailers in keeping their prices down – government support will be critical over the coming months. Pro-growth policies that allow businesses to invest in the customer offer will help maintain stability in the retail sector and foster long-term economic growth.
Targetfollow
For retailers, the current trend suggests that the worst may be over – but vigilance is required. With the uncertainty surrounding geopolitical events and extreme weather conditions, staying nimble and investing in robust areas of the economy is critical.
At Targetfollow, we understand that keeping abreast of the latest economic shifts and adapting to market trends is essential for business success. To stay up to date with our latest projects and for further insights into the UK economy, follow us on Facebook, X and LinkedIn.
