Food prices set to rise for Aussie shoppers
Analysts have dismissed the prospect of a supermarket price war continuing, with food prices at Coles and Woolies projected to stay steady or rise in 2017.
After heavy discounting in 2016 led to the sector's slowest rate of growth in 20 years, analysts believe the risk of a price war between major grocers is falling.
UBS analyst Ben Gilbert said in a report, “While we believe the market will remain competitive, the risk of a price war is falling. No listed retailer wants a price war, with discounters and consumers ultimately the only winners.”
Woolworths has reportedly invested $1 billion over 18 months in a bid to lower food prices and catch up with its major rivals, but this trend looks unlikely to continue.
News.com.au reports the latest retail trade figures show a 4.3 per cent rise in food prices in December, compared to the same period the year prior.
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