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UK fashion price falls accelerate, but consumers still fear inflation

Published
today Apr 5, 2017
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UK fashion retailers are caught in a price paradox this spring as new data shows non-food prices falling at a faster rate than of late while a survey also shows consumers planning to cut their spending overs fears about inflation.


UK consumers could cut their spring fashion spend over inflation fears despite the fact that prices are still falling



The British Retail Consortium and Nielsen said on Wednesday that while overall price deflation for March was the shallowest in in over three years at just 0.8%, for the non-food sector, it accelerated.

Non-food stores saw their prices dropping 2% year-on-year after a 1.8% fall in February. But food price inflation rose to 1% last month after a 0.8% drop the month before. And it is this inflation on daily essentials that is likely to lead consumers to rethink their spending plans for non-essentials like fashion, beauty and homewares.

BRC chief Helen Dickinson highlighted how global food commodity costs have risen by 17% on average over last year’s figures, building substantial pressure in the food supply chain. But while she said “the picture in non-food prices is positive for consumers,” it is likely that with prices falling while the cost of imported goods is rising post-Brexit vote, stores are resorting to more markdowns to shift their stock.

On Tuesday, a survey on behalf of Pension provider Scottish Friendly and the Social Market Foundation think tank said 46% of households plan to cut back on spending with more than half of that 46% citing the rising cost of living as the main reason for this.

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