Inflation in the UK economy is in focus in this morning’s papers as figures from the ONS and Kantar Worldpanel show higher prices are on the way. Food prices are set to rise as the grocery sector emerges from two years of deflation, reports The Telegraph. Grocery prices fell by just 0.1% – the lowest rate in more than two years – in the 12 weeks to 4 December, Kantar Worldpanel revealed. Increases in the cost of fresh fish, beer and chilled ready meals offset falls in basics, including vegetables, eggs and pork, the latest market data from Kantar showed (The Guardian).
Higher clothing, food and petrol prices pushed inflation to a two-year high in November, with economists warning of further price rises driven by the weaker pound to come, The Telegraph adds as the Office for National Statistics revealed that prices rose by 1.2% in the year to November. It was a further sign that the fall in the value of the pound since the Brexit vote was fuelling a rise in the cost of living, The Guardian writes. The Times adds inflation is on track to surge past 2% in the next few months as rising oil prices and the collapse in sterling take a toll on households. The Guardian asks why UK inflation is rising so quickly. Economics editor Larry Elliott says to blame Brexit and the oil prices.
Most of the papers combine their inflation stories with the latest supermarket performance stats from Kantar but The Mail leads with the surge in demand for premium own label as UK shoppers splash out on fancy mince pies and smoked salmon. Britons are already are spending 13% more on these lines than they did last year, according to Kantar Worldpanel data for the 12 weeks to 4 December.
The Guardian examines the choices facing crisps manufacturer Nim’s Fruit Crisps as the weak pound leaves the business with higher import costs, but a silver lining of increased export demand for products.
There is also plenty of coverage for the Asahi acquisition of SABMiller’s Eastern European beer brands. The Financial Times writes that Asahi is embarking on its most expensive overseas purchase with the €7.3bn ($7.8bn) takeover, transforming the Japanese brewer into Europe’s third-biggest beer group. The Financial Times’s Lex column points out that the Japanese brewer will have to push premium brands to justify the high-cost deal. “In Pilsner Urquell, Asahi has acquired a genuine heritage brand with high margins to match,” the paper says. “But Asahi has dug deep into its pockets, and will need to work hard to avoid accusations that it has overpaid.”
The Telegraph writes that in addition to the popular Pilsner brand, Asahi will pay 50% above the expected price tag to pick up Poland’s Tyskie and Lech beers as well as Hungary’s Dreher and Ursus from Romania. The Times highlights that AB InBev, which has now offloaded the SABMiller operations in the Czech Republic, Slovakia, Hungary, Poland and Romania, has been selling off businesses to secure regulatory approval for its £79bn takeover of SABMiller.
The retirement of M&S chairman Robert Swannell to scores plenty of column inches, with The Financial Times noting the ex-banker’s departure next year comes as the retailer embarks on a far-reaching turnaround plan. The Guardian notes that Swannell has overseen a tricky time at the high street bellwether, appointing long-term staffer Steve Rowe to take over as chief executive a year ago from former boss Marc Bolland. Swannell was best-known as the banker who helped Marks & Spencer fend off a £9.4bn takeover bid from Sir Philip Green in 2004, The Telegraph points out.
The Mail gives odds on Swannell’s replacement, with John Lewis chairman Sir Charlie Mayfield leading the pack at 3/1. Debenhams chairman Sir Ian Cheshire sits at 5/1, with Sir Charles Dunstone, the Carphone Warehouse founder and TalkTalk chairman at 6/1 and Kate Swann, the former WH Smith boss and now CEO of SSP Group, at 7/1. Sir Stuart Rose, Ocado chairman and former M&S boss, is a rank outsider at 66/1.
Argos shoppers could face delays to deliveries of their Christmas presents after drivers at its main distribution centre in Staffordshire voted to strike for three days from 20 December (The Guardian).
Finally, The Mail’s Midas share tips column says there’s “sweet success and rich rewards” on offer if you check in at Hotel Chocolat. The paper adds that with just a fortnight until Christmas, thoughts are turning to food, drink, treats and gifts – with Hotel Chocolat covering all four categories.
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