Higher UK clothing and
footwear prices helped to keep inflation at a near 30 year high in January,
according to data from the Office for National Statistics (ONS).
The UK’s Office for National Statistics (ONS) highlights in its Consumer Prices Index for January that clothing and footwear
made the largest upward contribution to the 12-month inflation rate with ONS
chief economist Grant Fitzner explaining inflation reached a “near 30 year
high”.
The index shows the Consumer Prices Index (CPI) rose by 5.5% in the 12
months to January, which is the highest 12-month inflation rate in the National
Statistic series since it started.
Clothing and footwear increased the rate by 0.14 percentage points between
December 2021 and January 2022. The 2.9% fall in prices in January was smaller
than the 4.8% fall a year earlier and is the smallest monthly fall for clothing
and footwear prices in January since the National Statistic series began in
February 2005.
Fitzner explains: “Clothing and footwear pushed inflation up this month and
although there were still the traditional price drops, it was the smallest
January fall since 1990, with fewer sales than last year.”
He also points out that some annual changes this year were affected by last
year’s lockdown, when many services were unavailable.
GlobalData apparel associate analyst, Louise Deglise-Favre adds: “Clothing
and footwear retail prices are heavily dependent on raw materials prices and
transportation costs, with these increasing throughout the year, it is
unsurprising that apparel prices contributed to the overall inflation in the
UK. “
She adds that brands such as Next and Joules warned earlier in the year of
price increases to cover their rising production costs and protect their profit
margins.
The ONS explains that prices usually fall sharply between December and
January each year because of post-Christmas sales. Prior to the Covid pandemic
and between the years of 2016 and 2020, the average monthly fall in January was
3.8%. For this reason, the 2021 monthly fall of 4.8% was slightly higher than
usual, and the 2022 monthly fall of 2.9% was slightly lower than usual.
It also notes that between November 2020 and January 2021, there was
increased discounting compared with other years and in January 2022 there was
less discounting. The unseasonal price rise in December 2021, followed by a
shallower than usual fall in January 2022, matches the pattern seen in the 2021
summer sales where there was an unseasonal rise in prices in June 2021,
followed by a smaller than usual drop in prices in July 2021.
The index notes the upward pressure was spread mainly across men’s and
women’s clothing (0.04 and 0.05 percentage points respectively), and women’s
footwear (0.04 percentage points), all of which saw smaller price falls in
January, compared with a year earlier.
Meanwhile, Fitzner adds despite clothing and footwear pushing up inflation,
the rising costs of some household goods and increases in rents also played a
part.
However, he says: “These were partially offset by lower prices at the pump,
following record highs at the end of 2021.”
By Just Style