19 September 2024
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.
Bira has reacted to the news that the UK inflation rate for August has remained unchanged from July, sitting just above the Bank of England's target of 2%. This marks a significant improvement from the peak of the cost of living crisis in 2022.
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," he added.
The Bank of England is expected to keep interest rates unchanged at 5% when it meets on Thursday.
Bira continues to advocate for measures to support high street businesses, particularly as they approach the crucial pre-Christmas trading period.
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