Retailers are fighting to keep prices low amidst rising costs, states the latest BRC-NIQ Shop Price Monitor, which found that shop price inflation increased to 1.2% YoY in May, against growth of 1.0% in April. Non-food inflation increased to 0.5%, against a decline of -0.1% in April.
Helen Dickinson, chief executive of the BRC, says: “Shop price inflation edged up in May as non-food prices rose. Furniture and health & beauty saw the sharpest increases, driven by rising raw material and shipping costs.
"Customers were still able to find bargains, with prices for TVs and audiovisual equipment falling as retailers help people get World Cup ready. Households did benefit from food inflation falling to its lowest level in a year, as intense competition among supermarkets continued to deliver value and savings.
“While retailers work hard to keep prices down for customers, they continue to face significant cost pressures, including higher energy bills and disruption linked to the conflict in Iran. Businesses cannot absorb these costs indefinitely, which risks pushing prices higher in the months ahead. To help protect households, Government should take action to reduce business costs. Reducing the non-commodity charges, taxes and levies that make up more than two-thirds of energy bills, and cutting red tape would help keep inflation down.”
Mike Watkins, head of retailer and business insight, NIQ, adds: “Food inflation is still around the same level as a year ago, helped by supermarkets maintaining promotions after Easter, but prices are now starting to creep up for non-food after a period of deflation. With external inflationary pressure building and many households cautious about spending, we can expect promotions across all of retail to increase over the summer months.”
