Fashion prices edge up as retailers unwind discounting
Fashion prices edged up in October as retailers began to unwind the heavy discounting that has characterised the sector over the past year.
According to the British Retail Consortium (BRC)-NielsenIQ Shop Price Index, shop prices overall were down 0.8% marking the third consecutive month of falling prices (September had declined by 0.6%).
Non-food shop prices overall were down 2,1% year-on-year with prices falling for electricals, such as mobile phones, while DIY costs also fell as retailers capitalised on the recent pick-up in the housing market. However, fashion prices edged up slightly for the first time since January as retailers pulled back on promotional activity, though with Black Friday and Christmas on the horizon, competition is expected to intensify in the coming weeks.
Food inflation eased to 1.9%, down from last month’s 2.3%, particularly for meat, fish and tea as well as chocolate and sweets amid Halloween deals.
British Retail Consortium CEO Helen Dickinson said the easing of food inflation would be welcome to consumers but she once again urged the Government to address iniquities in the business rates system to allow retailers to continue to offer keen prices for consumers, ahead of tomorrow’s budget.
“Households will welcome the continued easing of price inflation, but this downward trajectory is vulnerable to ongoing geopolitical tensions, the impact of climate change on food supplies, and costs from planned and trailed Government regulation. Retail is already paying more than its fair share of taxes compared to other industries.
“The Chancellor using tomorrow’s Budget to introduce a Retail Rates Corrector, a 20% downwards adjustment, to the business rates bills of all retail properties will allow retailers to continue to offer the best possible prices to customers while also opening shops, protecting jobs and unlocking investment.”
Mike Watkins, head of retailer and business insight at NielsenIQ, added: “Inflation in the food supply chain continues to ease and this helped slow the upward pressure of shop price inflation in October, however other cost pressures remain.
“Consumers remain uncertain about when and where to spend and with Christmas promotions now kicking in, competition for discretionary spend will intensify in both food and non-food retailing.”
