KPMG's Paul Martin, UK head of retail, said people were choosing to entertain at home to cut expenses. As council tax, mobile and utility bills rose and personal tax allowances were frozen, he added, the trend is likely to continue in April.
We will see consumers having to further cut back on discretionary spending, he said. Consumers are taking steps to reduce spending where they can - switching where they shop, what they buy, and spending on fewer items. Despite difficulties, the BRC said consumer confidence was edging up while big events such as the King's coronation in May were likely to boost retailers.
Until these future costs are brought to a heel, we will likely see high inflation continue for UK consumers who already face rising household bills from this month, she said.
The Bank of EnglandBank of England predicts that inflation will drop over the next few years as food and energy costs come down. Bank Governor Andrew Bailey has warned companies not to put up prices too steeply after a surprise rise in the UK inflation rate in February.
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