Helen Dickinson, head of retail at KPMG comments on the latest UK inflation figures from the Office for National Statistics:
“These figures are positive news for consumers and retailers alike as inflation may now be on its way down after peaking in September this year.
“Another consecutive fall in headline inflation rate was widely expected for November by most economists as commodity and oil prices start to annualise.
“However, if you scratch beneath the surface, retailers’ margins continue to shrink as unwilling consumers refuse to pay full price for anything.
“Looking further ahead, inflation is expected to drop and consumer confidence will most likely grow weaker – thus affecting retailers’ bottom line.
“Troubling times are expected for retailers in the New Year.”
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KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with nearly 11,000 partners and staff. The UK firm recorded a turnover of £1.6 billion in the year ended September 2010. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 150 countries and have more than 138,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.