The British Independent Retailers Association (Bira) has said the inflation rate holding steady at 2.2% in August provides some stability for the high street – but stresses the Bank of England needs to now reduce interest rates to boost consumer spending.
The steady rate for August comes despite a jump in air fares, offset by lower fuel prices and a slowdown in restaurant price increases. However, private rents across the UK increased by 8.4% in the year to August, potentially putting additional pressure on consumers’ disposable income.
Andrew Goodacre, CEO of Bira, said: “We’re pleased to see inflation has remained static, although consumer spending on the high street for non-essential items remains depressed. With inflation not rising, we hope the Bank of England will reduce interest rates to boost consumer confidence.
“Reducing interest rates is crucial to fully restoring consumer confidence and bringing people back to the high streets. We are approaching the golden quarter for retail, and we need to see consumer confidence and spend improve.”
