Retailers are hiking prices at the fastest pace in over three decades as Brits rush to scoop up Christmas presents to avoid being left empty handed, reveals fresh research published today.
Some 77 per cent of retailers raised prices over the last three months to November, the highest rate since 1990, according to data from the Confederation of British Industry (CBI).
Higher retail prices Will pinch Brits’ pockets hard just as they are ramping up spending during the festive period.
A toxic cocktail of supply chains gumming up, soaring staff costs and widespread shortages have compounded to attack retailers’ margins, prompting them to hike prices to protect profitability.
Ben Jones, lead economist at the CBI, said: “Cost pressures remain a very real concern, however, with selling prices growing at the fastest pace since 1990.”
The CBI’s figures feed into the string of data published recently highlighting the scale of inflation seeping into each corner of the UK economy.
Official inflation figures published by the Office National Statistics puts the rate at 4.2 per cent, the highest in nearly a decade.
IHS Markit this week released a closely watched survey revealing private sector cost burdens rose at the fastest rate since January 1998.
However, historically high demand is allowing firms to pass on prices without meeting much resistance from consumers.
35 per cent of shops reported sales were booming, the highest proportion since in over six years, and up sharply over the last month.
The upsurge in sales has been driven by shoppers bringing forward Christmas purchases to avoid losing out on products amid reports of retailers struggling to keep shelves fully stocked, according to experts.
Gabriella Dickens, senior UK economist at Pantheon Macroeconomics, said: “These positive signals… most likely reflect consumers bringing forward their Christmas shopping in the face of warnings over potential shortages, rather than a pick-up in underlying demand.”