Responding to the latest CPI inflation figures, which show headline inflation falling to 2.8% and food inflation remaining unchanged at 3.3%, Kris Hamer, Director of Insight of the British Retail Consortium, said:
“Headline inflation fell marginally in February, driven by marginal drops in housing and household services and clothing and footwear entering deflation. Despite continued cost pressures, namely energy price volatility, food inflation remained unchanged. There was good news as some dairy products such as milk, cheese and eggs all saw price drops on the month. Heavy clothing and footwear discounting continued into February, as fashion sales continue to suffer due to unseasonal weather throughout the month.
“Retail operates on tight margins and it would be impossible to absorb all £5bn of new costs which hit the industry in April. Food inflation has jumped significantly in recent months and is forecast to hit 5% by the end of 2025 as a result of the costs arising from the Budget. On top of this, retailers are still burdened by an outdated business rates system. It is vital that the government’s reform of business rates doesn’t impose additional costs onto retailers. Reform must leave no shop paying more.”
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