BIRA hopeful that shop price inflation will now fall

The British Independent Retailers Association has reviewed recent figures from the BRC-Nielsen Shop Price Index and has said they are “hopeful” costs have now peaked but are urging the government to start focusing on a growth agenda.

Speaking about the report, BIRA, which works with over 6,000 independent businesses of all sizes across the UK, commented on the figures which reveal inflation is likely to have now peaked.

The report shows that shop price inflation has decreased to 8.8 per cent in the first week of April, dropping from 8.9 per cent in March. However this has exceeded the three-month average of 8.7 per cent.

Also reported:

• Non-Food inflation decelerated to 5.5 per cent in April, down from 5.9 per cent in March. This is below the 3-month average rate of 5.6 per cent. Inflation remains elevated in this category.
• Food inflation accelerated to 15.7 per cent in April, up from 15.0 per cent in March. This is above the 3-month average rate of 15.1 per cent, and is the highest inflation rate in the food category on record.
• Fresh Food inflation accelerated in April, to 17.8 per cent, up from 17.0 per cent in March. This is above the 3-month average rate of 17.0 per cent and is the highest inflation rate in the fresh food category on record.
• Ambient Food inflation accelerated to 12.9 per cent in April, up from 12.4 per cent in March. This is above the 3-month average rate of 12.5 per cent and is the fastest rate of increase in the ambient food category on record.

“It was good to see shop price inflation and non-food inflation decelerate and hopefully this will continue for the remainder of the year,” said Andrew Goodacre, BIRA CEO. “However, seeing food inflation rise again is a real concern.

“The cost of food is rising faster than ever and not only does this dampen consumer confidence, but it also means there is less money for the more discretionary consumer expenditure. We are promised lower food prices in the next few months and I would like to be reassured that there is no profiteering in the various supply chains,” he added.

“The fact inflation in non-food areas is decreasing does not automatically mean that consumer spending will increase. Retailers are having to accept lower margins (through sales promotions) to generate income but this is not sustainable for many. We really need to government to start focusing on a growth agenda to bring the economy to life.”