A RETAIL expert at a Castle Donington firm of business advisers believes shoppers can expect price hikes on non-food goods because of the weak pound.

Andy Lyon, retail expert and senior partner at PricewaterhouseCoopers in the East Midlands, said that in the next 12 months the UK non-food retail sector could potentially be exposed to over £20bn of extra costs.

In May last year, the exchange rate between the pound and the dollar was roughly $2 to £1. Last month it was $1.50 to £1. Recently, the pound had strengthened to $1.64 to £1.

Mr Lyon said as a result, British retailers were feeling the impact of additional costs from imports and these would have to be passed on to consumers.

He said: "At a time when consumers are watching their spending closely and consumer confidence appears to be improving, the last thing shoppers need is price rises.

"But since retailers' margins are so tight, these extra costs will potentially spill over into the prices consumers are asked to pay."