The latest announcement from the ONS confirms that inflation at 2.6% for July has remained well above the target rate of 2%, albeit slightly below market expectation of 2.7% - with a knock on effect on consumer spending, which stifled disposable income and forced consumers to tighten their belts.
Coupled with the ongoing fall in real wages, July saw consumer confidence declining and is leaving retailers of all sizes in a vulnerable position as consumers are priced out of purchasing many of their desired products.
It's also apparent that retailers have felt the pinch from the weak pound in July, as their own costs increased and they were left with the difficult decision of whether to absorb the costs or pass them onto the consumer.
One thing is certain - it's undoubtedly an incredibly challenging time for UK retailers, and in order to help consumers feel they’ve got their spending power back, retailers much look at the levers at their disposal, be that further discounting or investing for the long-term in payment options.
Despite the pause in CPI inflation growth, prices are still rising well ahead of average wages, meaning a real terms squeeze on most peoples' living standards. "Although inflation is likely to start falling next year, we understand some families are concerned today about the cost of living. That is why we have given the lowest paid a pay rise through the National Living Wage and are cutting taxes for 31 million people," said a Treasury spokesperson