Consumer price inflation remained unchanged in August at 3.1% although there were significant upward and downward pressures between July and August, according to the Office for National Statistics.
Clothing and footwear prices rose by 2.8% August, in the largest rise for the period since 2001. The rise was driven by women’s outwear where prices rose sharply at the start of the autumn fashion season.
Food prices also rose, with strong monthly rises in the cost of bread, cereals and vegetables. Bread and cereal prices rose by 1.2% between July and August but fell by 1% a year ago.
Non-alcoholic beverage prices increased by 5.8% (down 10 bps on the July figure), whilst alcoholic beverage inflation was 1.8% with tobacco prices still rising by over 7% (7.2%).
“We believe the increase in food inflation should and will be broadly welcomed by the UK retailers and their investors, as it will provide a much needed boost to like-for-like revenue growth, especially so given subdued volumes that are confirmed by recent trading data from the UK companies,” Shore Capital analyst Clive Black said in a research note.
Furniture and furnishings prices rose by 1.6%.
The alternate Retail Price Index measure of inflation, which has a longer history and includes more housing costs, fell to 4.7% from 4.8% in July.