Rumour has it that clothing prices are just one of the expectations that are set to rise within the UK due to Brexit, as well as fuel costs.
The Office for National Statistics (ONS) and the Consumer Price Index (CPI) have measured the huge inflation which was previously estimated at a 1.1% rise for clothing items. Rises appear to be reaching at least 1.2% at the current time which has evidently exceeded the estimation. Both businesses and consumers will suffer such rises occurring if this is set to continue. Initially pencilled, this estimation stemmed from the UK’s choice to leave the EU earlier this year.
This rise has been the highest it has ever been within the clothing sector for at least six years. The chief economist at Pantheon Macroeconomics, Ian Shepherdson, said: “the drop in sterling means we have to expect a further increase in clothing inflation over the next year”. There have been many theories that the rising costs of clothing will reach a high of at least 2.7% within the coming years. Directors and executives within businesses will continue to suffer these increases due to the cost pressures of these consumer rates, evident since the Brexit vote.
The fact that the price of sterling has dropped means that the UK should expect such rises within businesses and is slowly impacting on consumers too. It will essentially be consumers who will notice the consequences of the suffering sterling, as the cost of living is becoming more pricey than ever. Not only is clothing and fuel on the rise, but also food and non-alcoholic drink prices. The sterling has hit a huge low which hasn’t been the case in over 31 years – it even dropped by 10% against the US dollar since Brexit in June.
Clothing retailers appear to have had much fewer sales according to a CPI survey, studying the months from October – November 2016 in comparison with sales from the same months in 2015. It appears that consumers are not happy with these rises and are unwilling to pay. Diesel has risen up to 2p per litre to a rough figure of 118p per litre and petrol has risen 1.6 per litre in comparison to a 0.6 fall last year. Consumers and retailers alike are anxious about the year ahead.