Basic purchases will become more expensive on average by about 3% y/y before the holidays, and this will be a less significant difference than the one recorded a year earlier, when increases at the peak of inflation exceeded 20% y/y, predict the authors of the report “Price Index in Retail Stores”, published by UCE Research.
Experts predict that the prices of food additives, sweets and desserts, and household chemicals will increase the most. At the same time, they assume that other groups of products traditionally purchased for Easter will not become much more expensive. Prices may go up slightly, but only after Easter, when the VAT rate on some items will be unfreezed. food.
The report shows that in February, the prices of basic products increased on average by 3.9% y/y. The January increase reached 4.9% y/y. In turn, the December one was 5.6% y/y. The authors of the report believe that the downward trend will continue in March and prices in stores will increase by a maximum of approximately 3% y/y. Monitoring from the first two weeks of March shows this tendency, although there is still some time until Christmas and the situation may change slightly.
“A year ago, in the epicenter of inflation, the increase exceeded 20% y/y. Nothing dramatic should happen now. The only concern is the announcement of a return to the normal VAT rate for some food items. It may encourage retailers to raise prices in March, then, at the beginning of April, to successfully lower them and widely communicate that products in a given retail chain are not getting more expensive, but are actually getting cheaper. We have already seen a similar mechanics when introducing zero VAT. Back then, stores artificially raised prices for a while to then show that they will cut them by the rate of the above-mentioned tax. However, the matter in this respect is not entirely settled,” we read in the statement.
“The pre-Christmas period may slightly increase the demand pressure, but not enough to significantly affect noticeable price increases. The dynamics of price increases on a y/y basis will remain at a slight increase,” said Tomasz Kopyściański from the WSB Merito Wrocław University, quoted in the release .
According to analysts from UCE Research, the above issue will also be helped by a “price war” between discount stores where most Poles do their shopping, including Christmas shopping.
“The high increase in prices before the last holidays led to consumers issuing a 'red card' to stores, which translated into reduced demand and poor sales results. This time, stores are unlikely to be willing to take such actions. Any price increases will probably be less conspicuous.” eyes, e.g. by leaving the same price level with reduced packaging or capacity,” said Anna Motylska-Kuźma from the University of Lower Silesia DSW.
Last month, out of 17 monitored categories, 10 showed single-digit y/y increases. Double-digit increases concerned 2 groups of goods, and 5 decreases were recorded.
