House prices rose in April in a shock to analysts who predicted they would continue to fall, according to Nationwide’s monthly index. The lender said that average UK home increased in value by 0.5 per cent after seven months of consecutive falls which it put down to “shifts in consumer sentiment”.
However, Nationwide’s data does not chime with figures from the ONS, which uses data from the Land Registry rather than Nationwide’s dataset of mortgage approvals. The ONS is still recording falling prices as of its most recent update for the month of February. Meanwhile, fellow lender Halifax has posted three consecutive months of house price increases for January to March. ML
Read more: Our house price obsession is marking down good businesses
Shop price inflation eases
Shop price inflation slowed marginally to 8.8 per cent in April, down from 8.9 per cent in March and may well have peaked, according to the British Retail Consortium.
The slightly weaker inflation rate was due to discounting in non-food retail, where inflation fell to 5.5 per cent, from 5.9 per cent a month earlier. Food inflation continued to climb to 15.7 per cent, from 15 per cent in March and the highest rate on record, the industry trade body said. It attributed the increase to “ongoing cost pressures” throughout the supply chain, from higher packaging costs for ready meals to higher coffee bean prices as producer nations exported less.
“We should start to see food prices come down in the coming months as the cut to wholesale prices and other cost pressures filter through,” said BRC chief executive Helen Dickinson.
Clive Black, research analyst at Shore Capital, said that although inflation remains problematic in terms of weakening demand for consumers and as an operating expense item for retailers, “we could now be at the high-water line of consumer inflation in the UK”. MF
Read more: Inflation won't just erode our national debt and FTSE 350 Review: Supermarkets try to weather the storm
Wagamama owner flags stronger trading
Shares in The Restaurant Group (RTN) bounced by 12 per cent on the back of an unscheduled update flagging “strong” trading in both its pubs business and the Wagamama Asian food chain.
The company, which has been under pressure from Hong Kong-based activist investor Oasis Management to conduct a strategic review, said like-for-like sales in Wagamama are up 4 per cent for the first four months of this year and are 6 per cent higher in the Brunning & Price-branded pubs business. It added that plans to improve margins had resulted in around £5mn of “incremental annualised cost savings”, with 23 of its leisure sites set to close by the end of May.
The Restaurant Group’s management has been under pressure to improve performance from Oasis Management, which now holds a 12.3 per cent stake in the company.
In February, Oasis said that despite possessing a strong portfolio of brands, The Restaurant Group had “one of the worst performing share prices of any UK leisure company”. Its shares have fallen in value by around two-thirds since its last equity raise in March 2021, which was its third in three years. MF
