Key insights
- British shop price inflation accelerated in May due to supply chain disruptions and higher energy costs, potentially impacting consumer spending. While food price inflation slowed, furniture and health/beauty products saw significant increases. The BRC urges government intervention to reduce costs for retailers. This may lead to slightly negative sentiment in US markets due to concerns about global inflationary pressures.
Investing.com -- British shop prices increased at a faster pace in May, driven by disruption and higher energy costs linked to the Iran war, according to data released Tuesday by the British Retail Consortium.
The BRC’s monthly survey of major retail chains showed prices in May were 1.2% higher than a year earlier, compared with a 1.0% increase in April.
Food price inflation slowed to 2.7% from 3.1%, marking its lowest level in a year.
Furniture and health and beauty products saw the largest price increases, reflecting rising raw material and shipping costs.
BRC Chief Executive Helen Dickinson said the government needs to take action to reduce costs for retailers. The government has recently pressured supermarkets to slow price increases and considered implementing price caps this month.
"Reducing the non-commodity charges, taxes and levies that make up more than two-thirds of energy bills, and cutting red tape would help keep inflation down," Dickinson said.
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