Interest Rates, Inflation and Retail
In the krunchbox sponsored “2023 Retail Trends & Disruptions” report published in December 2022, inflation and recession were hot topics. When the surveys were being circulated we were in the early stages of what has become a long series of regular interest rate rises, which are still going on at the time of writing. It doesn’t take a Professor of Economics to observe that rising inflation coupled with increasing interest rates increase the cost of borrowing and make it harder for consumers to obtain credit. As a result, purchasing power declines which leads to lower retail spending.