Commenting on the latest consumer price inflation figures releases by the ONS today, Rachel Lund, Head of Retail Insight & Analytics at the BRC said:
"It may be an expensive Christmas dinner this year as a combination of more costly imports and higher world food prices, particularly for dairy products, pushed food price inflation over four per cent year on year in October.
"With more of consumers’ incomes being absorbed in spending on food, retailers of non-food products are having to compete harder for business. In a dismal month for non-food sales, shoppers were offered significant discounts, leading to a drop in the inflation rate of goods such as furniture and clothing. Discounts are being offered at a time when many retailers are coming to the end of the protection from higher import costs provided by hedging facilities. That is putting an enormous squeeze on retailers’ margins as they head into what may well be a nerve wracking festive period.
"All eyes are now on the Chancellor to tackle the underlying weakness in consumer spending: we urge him to deliver a shoppers’ budget to the UK in time for Christmas."
Read the BRC’s Budget submission: Helping Shoppers Budget