Cut locks and cold ices
The heatwave and the pent-up lockdown demand for a cool new look have boosted the high street
Inflation took a surprise lurch upwards in July. So much for expectations that businesses would try to tempt nervous customers back out with steep discounts. The price of heatwave favourites such as ice cream soared. But summer getaways are cheaper, with flights and hotels costing less than they did a year ago. Overall the result was a 1pc rise in prices across the nation. Here are the key factors pushing living costs up and down.
As a shaggy nation emerged from isolation, the newly and unhappily hirsute made a beeline for the barber.
Understandably keen to get some cash in after months without customers, and pay for the cost of extra PPE, the embattled scissor-wielders hiked prices by 8pc for men and children, and 5.6pc for women.
Something of a necessity in hot weather, pent-up demand for getting out and having fun led to an extremely sharp increase in ice cream prices.
The current records for ice cream only go back to 2016 but the latest increase of 16.7pc is far and away the biggest in that time period.
Fuel costs are a big chunk of household spending, particularly as public transport is out of favour.
A litre of petrol cost £1.11 on average last month, up from its recent low of £1.05 in May. Diesel showed a similar pattern, up from £1.12 to £1.17. This is still way down from last summer, when petrol was £1.27 and diesel £1.32, but the rise in recent months still contributed to the increase in headline inflation. This new increase follows a rise in global oil prices, though drivers will be disappointed that the cost of filling the tank did not drop more in the greatest oil bust of recent years.
Hard-pressed retailers have been slashing prices in recent years as they compete to win custom.
A big summer sale had been anticipated to encourage shoppers to return to Covid-sanitised stores. Yet for women and children prices are up compared with last summer.
Richard Lim, at Retail Economics, notes that the surge in online sales may have kept the pressure off – typically the cheapest retailers do not sell online, so this favours slightly pricier clothes.
At the same time, businesses such as M&S and Next have shipped stock to warehouses for next summer, instead of slashing prices to clear it now.
DIY is high up the agenda for families who have had more time than usual to consider their property’s decor.
Garden furniture prices are up 7.5pc on the year, with outdoor space more appreciated than ever by homeowners.
Interior furniture, fridges, cleaning equipment and irons are all risers, too.
Steep demand for a summer getaway combined with lack of choice and capricious changes in quarantine rules sent package holiday costs up more than 5pc compared with last July.
It is the biggest annual increase for this time of year in more than a decade.
‘Keen to tempt nervous Britons out of self-isolation, hotels cut prices for the first month since reopening’
With foreign trips still tricky to negotiate, holidays at home are more popular. Demand for camping gear has pushed prices up 6.4pc, the highest since 2016. The price of trips to campsites rose by 2.7pc.
Takeaway meals became a favourite in lockdown, sending prices up rapidly.
The vogue did not end with the reopening of sit-down restaurants in July – prices are up 5.5pc on the year.
This is not a one-way story. Inflation is still only 1pc overall, and some products are markedly cheaper than they were a year ago. Electricity is down 2.1pc and gas 12pc, in large part the result of cuts to regulated costs.
Keen to tempt nervous Britons out of self-isolation, hotels cut prices for the first month since reopening.
A stay in July cost 4.7pc less than the same trip a year ago.