After poor sales in December, UK retailers did not experience a significant improvement in sales in the first month of this year, despite hefty reductions. Clothing, footwear and furniture prices fell sharply in January, proving surging raw material costs for manufacturers are not stoking inflationary pressures on the high street.
On the CPI measure, the consumer prices index adopted by the UK government for its UK inflation target, clothing and footwear prices tumbled 3.7% in January, and they were down 5.9% on a year earlier. Seasonal reductions on men and women's outerwear were deeper than a year earlier. In Scotland, clothing and footwear retailers once again experienced a tough month, with shoe sales in particular faring worse than in the rest of the UK.
Prices in the furniture, household equipment and routine maintenance category fell 4% last month, more than reversing a 2.2% rise in December, producing an annual deflation rate of 0.4% in this segment. Furniture was the driver of the fall in prices in this category in January, with bigger seasonal reductions this year.
According to the Office for National Statistics, falling prices of fuel and airfares, resulting in lower transportation costs, kept Britain’s inflation rate at 1.6% in January, despite rising prices in other sectors such as seasonal food.
