Furniture prices continued their upward spiral last month, taking the annual inflation rate to 8.4%, the highest since detailed records began in 1986.
Almost all shopping items from bread, furniture and crude oil increased in price between the new year and the end of February, according to data from the Office for National Statistics.
The pressure on household incomes was driven by rises such as an average 5.5% in meats and 6% in imported cereals. Other basic products have also risen sharply, with butter up 62.1% in each of the three leading supermarkets, Tesco, Asda and Sainsbury's, and eggs rising by 30%-40% for a dozen free range.
How does this affect the furniture industry, one may ask?
With a majority of ready to assemble furniture arriving to the UK from the Far East, and the constant rise of fuel costs, we are beginning to see increases in pricing across the board for furniture and home products. The worst is yet to come, as inflation is expected to increase, and the GBP continues to slide against the RMB. Major furniture retailers are feeling anxious dues to this looming prospect.
There has also been an increase in movement away from China as a manufacturing center, toward countries such as Malaysia, Thailand, and Vietnam, where labor is now relatively cheap. If there is any silver lining in all this, it will be the reintroduction of some locally manufactured furniture and home products, most of which boast superior quality. Inflated prices for imported goods from China will mean better competition from local manufacturers (however this will not happen overnight).
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