The supermarket giants Coles and Woolworths’ Shoppers are warned to expect the prices to soar, as the cost of living in Australia climbs even further.
The new research has revealed that the cost of products on shelves at supermarkets could increase by a whopping 12 per cent this year
Last week, the reserve bank of Australia (RBA) increased the interest rates in the country from 0.1 per cent to 0.35 per cent.
To curb the cost of living in the country, the government decided to increase the cash rate for the first time in 11 years.
As inflation continues to soar, there will be looming price hikes on every product.
Bill Gilbert, retail analyst at investment bank Jarden, said the price hikes at supermarkets will continue to soar amid the increasing inflation in the country.
“There will be a significant price hike at supermarkets, and it will be larger than we expected,” Mr. Gilbert said.
“There will be a further hike on several products, either a second or a first at a planned weighted rate of 7.4 per cent. This represents a scenario where we could see an annualised run-rate of more than 12 per cent through 2022.”
Moreover, Mr. Gilbert also said special sales and promotions at supermarkets are likely to drop.
“Despite retailers and suppliers actively pulling promotions through January, reflecting supply chain issues, not all suppliers are able to concurrently or are planning to reduce promotions,” he said.
The major groceries at Australian supermarkets have already gone up to a whopping 94 per cent in the past year, revealed by the data released last month.
The supermarkets admitted increasing the prices of several grocery products due to rising costs. While they also said prices to get worse in the months ahead.
Price Hike at Major Supermarkets
Coles has increased the prices by 3.3 per cent on a range of everyday products over the March quarter to pass on the rising cost of fuel, shipping, meat, vegetables, and fruits.
The supermarket giant said the cost of products on shelves could climb further in the upcoming months.
Woolworths has increased the prices by 2.7 per cent on everyday items as its managing director Natalie Davis revealed that 160 out of its top 200 suppliers has urged to increase the cost of their product.
Extracted from The Australian Business Journal