Store prices are dropping again – but how long will it last? | Economic news

With big price hikes on the horizon, buyers are being encouraged to splurge now as costs stay low.

The British Retail Consortium (BRC), the trade group representing store owners, said on Tuesday that although store prices continued to fall in May, the drop was the slowest since February 2020, indicating that depressed costs in Due to the economic uncertainty surrounding the pandemic were coming to an end.

And with global food prices currently at their highest in seven years, commodity prices rising and shipping costs three times higher than in 2019, the BRC warns the second half of this year is expected to surge. store prices. .

“Cost pressures are decreasing,” said Helen Dickinson, BRC CEO. “We will likely see these costs filter out in the second half of this year, and with the additional Brexit red tape this fall, retailers may be forced to pass some of these costs on to their customers.”

“The government can help ease the burden on UK consumers by finding ways to minimize the impact of the new checks and documents required from October.”

Data from last month shows electronics and furniture prices are already on the rise due to supply chain disruptions, even as clothing and footwear prices continue to fall.

Supermarkets, meanwhile, have “fought hard to retain market share and appeal to thrifty customers by keeping prices low,” Ms. Dickinson said.

Store prices fell 0.6% year-on-year in May, a slower decline than the 1.3% drop in April. This is lower than the 12- and 6-month average price drops of 1.7% and 1.8%, respectively, and the slowest rate of decline in over 14 months.

And with household bills rising, consumers should be happy that it is still relatively inexpensive to shop, analyst Mike Watkins said.

“Consumers will see the impact of rising energy and fuel costs on household bills and while some cost prices …