Fashion prices pushed up inflation in December

Fashion prices pushed up inflation in December
Soaring demand for computer games and consoles and children’s toys also pushed up inflation, the ONS said.
// CPI inflation rose to a slightly higher-than-expected 0.6% in December from 0.3% in November, ONS says
// Clothing prices rose marginally – up 0.1% – between November & December, but declined year-on-year
// RPI, a separate measure of inflation, was 1.2% in December, rising from 0.9% in November

UK inflation picked up pace in December after hard-hit clothing retailers held off from further steep discounts and as transport costs edged up, according to official figures.

The ONS said Consumer Prices Index (CPI) inflation rose to a slightly higher-than-expected 0.6 per cent in December from 0.3 per cent in November.

It said clothing prices rose marginally – up 0.1 per cent – between November and December, in contrast to the usual falls seen due to Boxing Day sales, though prices still dropped on an annual basis.

Soaring demand for computer games and consoles and children’s toys also pushed up inflation further, with annual recreation and culture inflation hitting its highest level since August.

Meanwhile, transport prices lifted as some travel restrictions eased earlier in December and air fares rose month-on-month despite the pandemic curbing most international travel.

“Clothing prices put upward pressure on inflation in December, despite some evidence of continued discounting,” ONS national statistician Jonathan Athow said.

“Transport costs, including air, sea and coach fares, as well as petrol prices, rose as some travel restrictions eased during parts of the month.

“These were partially offset by falling food prices, most notably for vegetables and meat.”

Clothing and footwear firms had already slashed prices in November amid the second lockdown in England, which disrupted the usual discounting seen after Christmas.

Swathes of the high street were also forced to shut amid tightening coronavirus restrictions just before the holidays.

The ONS said the annual rate of clothing and footwear inflation fell by 1.8 per cent against the unusually steep 3.6 per cent decrease in November.

Recreation and culture annual inflation jumped to 2.6 per cent in December, while transport cost inflation hit its highest for 18 months, at 1.9 per cent.

The data also showed that petrol prices rose 1.5p over the month to 114.1p a litre, as the oil price continued to climb.

Higher alcoholic drink and tobacco prices saw a CPI rise last month, with 2.2 per cent on tobacco products due to a tax hike from mid-November.

The Retail Price Index (RPI), a separate measure of inflation, was 1.2 per cent in December, rising from 0.9 per cent the previous month.

The CPI, including owner-occupiers’ housing costs (CPIH) – the ONS’s preferred measure of inflation – was 0.8 per cent last month, up from 0.6 per cent in November.

with PA Wires

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