UK Retailers Warn of Rising Prices as Costs Surge

Higher employment costs, packaging levies, and food inflation are set to drive up prices, with food costs expected to rise over 4% by mid-year.

Shop prices in February saw their largest monthly increase in a year, rising by 0.4% compared to January, according to the British Retail Consortium (BRC).
Food inflation climbed to 2.1% year-on-year in February, driven by higher costs for staples like butter, cheese, eggs, and bread, with further increases projected.
Retailers face a £7 billion rise in annual costs from April due to minimum wage increases, packaging levies, and payroll tax hikes outlined in the autumn budget.
Non-food prices fell 2.1% year-on-year despite a 0.5% monthly increase in February, as retailers offered discounts to counter weak consumer demand.
The Bank of England forecasts headline inflation to reach 3.7% by the third quarter, with rising energy prices and government-controlled costs contributing to the pressure.