Furnishing & Floorcovering
After reporting annual deflation of 0.6% in May, the furniture and floorcovering category moved back into inflationary territory, increasing 1.5% in June. Upward pressure was exerted by the furniture and furnishings category which reported its highest inflation rate since March 2011. This was offset by the home textiles category where annual inflation slowed. The sector, which relies heavily on the number of housing moves, is suffering from the weak housing market.
The Nationwide house price index showed a subdued market in June. The three-month-on-three-month measure, reported sales up 0.3%, slightly weaker than the 0.6% growth recorded in May. This was supported by mortgage approval figures from the Bank of England which showed a small improvement on the previous month, however, approvals still remain below the average compared with the previous six months.
A recent survey by Moneyfacts reported tracker and fixed rate mortgages were the cheapest they had been since the survey began in 1988, although first-time buyers still face the 'deposit barrier' which stops them benefitting from the best offers. Mortgage interest rates have been slashed by lenders as many expect loose monetary policy to persist.
Prices rose 0.6% on a month-on-month basis in June, after falling by the same amount in May.
British Retail Consortium
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