Retailers’ bodies react as inflation drops

Retailers are playing a key part in bringing inflation down, UK’s leading retailers’ body stated today (22) as official data shows a drop in annual inflation rate to a near three-year low in April as energy prices cooled further, easing a cost-of-living crunch and stoking rate cut expectations.

The latest CPI inflation figures, released today (22), shows headline inflation falling to 2.3 per cent and food inflation falling 1.1 percentage points to 2.9 per cent. 

Reacting to the ONS data, Kris Hamer, Director of Insight of the British Retail Consortium, said, “Inflation continued to head back towards the Bank of England’s 2 per cent target, with a significant drop in April. The lowest energy price cap in two years and food inflation falling to its lowest level since November 2021, helped to reduce pressure on household finances and brighten their outlook for the economy.

“There were also notable falls in the inflation rate of clothing and footwear and alcoholic beverages. And there was good news for fruit lovers as the price of fresh, dried and preserved fruit products all fell on the month.

“Retailers are playing a key part in bringing inflation down, but it is vital that government policy supports this too. Retail plays a key role in every part of the country, from the smallest village to the largest city, employing millions of people, and serving millions more.

“As the cost burden of new policies rises – from business rates to packaging taxes – this affects not just the businesses, but the customers too. With an election looming, it is vital that parties outline their support for customers and retailers through the upcoming manifestos.”

Independent retailers’ body BIRA stated that inflation rate falling to 2.3 per cent is a good step towards bringing people back to the high street, stressing the Bank of England needs to now reduce interest rates too.

Andrew Goodacre, CEO of Bira said, “Inflation has fallen lower than expected and is now only slightly above the Bank of England target of 2 per cent. Although the services sector and core inflation has not fallen as much, we hope that the Bank of England will have the confidence to reduce interest rates.

“Reducing interest rates is crucial to fully restoring consumer confidence and bring people back to the high streets,” he said.