Payset prespective
June 6, 2022

Retailers Could Stop Raising Prices as Inflation Rates Settle

Companies have been raising prices to counter inflation, but their ability to do so may be waning. Have price increases for consumer products peaked?

Retail companies could soon ease their habit of raising prices in response to heightened inflation rates, according to a new report from Bloomberg.

Profit Margins Are Reportedly Shrinking

Although price increases are a common response to rising inflation rates, there are limits to how far consumer prices can be raised. Profit margins now appear to be shrinking as retail prices close in on the cost that stores pay to obtain goods.

Retail outlets such as Walmart and Target have reported shrinking price margins. During the first quarter, both companies saw a shift toward grocery, food, and drink purchases—a category with low profit margins. Other departments with higher profit margins, such as housewares and electronics, saw declining demand from consumers.

Other trends were seen elsewhere. Department stores T.J. Maxx and Marshalls saw increasing demand for their off-brand products. Furthermore, Dollar Tree and Dollar General are reporting larger sale expectations, which is another sign that shoppers are turning toward low-margin retailers as goods become more expensive.

Statements from experts also affirm that retail prices will likely be reduced in the future. The Federal Reserve has stated that its business contracts have begun to “report that higher prices were hurting sales.” Meanwhile, 22V Research has said that pricing power remains high but “has moved lower over the past few quarters.”

Falling Inflation Rates Could Correct Prices

While increasing inflation rates may have initially driven price tag increases, falling inflation rates could soon reduce the ability of companies to raise prices. 

In fact, the trend is likely to stabilize to some degree. Economists at JPMorgan Chase said that global inflation will likely peak at an annual rate of 8.6% this quarter before falling to a much lower annual rate of 3.25% in the latter half of 2022.

Additionally, companies could offset the losses from lower price margins by cutting corners elsewhere—by reducing staffing and limiting wages. 

It is unclear whether price increases have reached their peak for the foreseeable future. 

But overall, these events suggest that consumers are moving toward low-cost options. In order to complete and with falling inflation rates, retailers will need to slow the rate at which they increase prices.

At Payset, we offer foreign currency accounts with support for the U.S. dollar, the euro, and more than thirty other international currencies—giving you the chance to execute rapid trades.

open account

Frequently asked questions

What is a multi-currency account/virtual IBAN?

A Payset multi-currency account allows you to receive money in 34 different currencies and send money in up to 38 currencies, all within the same account.

You can deposit and withdraw funds, convert currencies at competitive exchange rates, and hold your chosen currencies to capitalize on market movements.

A Payset multi-currency account allows startups and business owners to receive payments from clients virtually anywhere in the world and pay suppliers, staff, and contractors quickly and affordably in their chosen currency.

  • Funds can be deposited and withdrawn from the account for a small fee.
  • Account holders can send and receive money with other Payset users for free.
  • Depending on your region, you can use various payment networks from your Payset account, including SWIFT, SEPA, ACH, Fedwire, Faster Payments, BACS, and CHAPS. 
  • Once you register an account, you will be provided with a Virtual IBAN (International Bank Account Number), which makes all of these transfers easy.
  • We provide you with local payments and collections. For example, transactions in USD, EUR, CAD, and GBP are processed through the local payment networks, which is far cheaper and takes minutes as opposed to days

Are there limits on the amount of money I can send and receive?

No, there are no transaction limits on Payset multi-currency accounts.

However, higher-volume transactions may require additional anti-fraud verification. If you plan to make a large transaction, contact us in advance to avoid verification delays.

How is Payset regulated?

Payset is regulated as an authorized Electronic Money Institution by the UK Financial Conduct Authority. Our activities are also regulated by the Payment Services Regulation 2017 and the Electronic Money Regulation 2011 (SI 2011/99).

How do I send money from my account?

Once you have opened your verified IBAN account and added money to a balance, transferring funds is simple.

Simply log in into your account and add a beneficiary, then simply “make a transfer” in your preferred currency to that beneficiary.

Information contained in this publication is provided for general education and information purposes only and should not be construed as legal, tax, investment or other professional advice or recommendation, or an offer of, or solicitation for, any transactions or any other actions (or refraining therefrom); This material has been prepared without taking into account any particular recipient’s financial objectives or situation. We make no warranty, guarantee or representation, whether express or implied, as to the completeness or accuracy of the information contained herein or fitness thereof for a particular purpose; Use of images and symbols is made for illustrative purposes only and does not constitute a recommendation or advice to take or refraining from any action; Use of brand logos does not necessarily imply a contractual relationship between us and the entities owning the logos, nor does it represent an endorsement of any such entity by Pay Set Limited, or vice versa; Market information is made available to you only as a service, and we do not endorse or approve it; Any reference to past performance, predicted returns, or likelihood performance scenarios may not reflect actual future performance and certainly do not guarantee future outcomes.

Manage Global Payment with a Payset Business Account

Rating star

I wanted to express my appreciation for the successful cooperation between my firm and Payset. I would like to point out in particular the professionalism, the manner in which requests are handled, the quick response time and the satisfaction of the clients. I strongly believes that we will continue to move forward and create many collaborations in the future

Asaf and the team
Rating star

The experience of using PaySet account was really interesting. It is one of the most ergonomic systems I have ever used. Support provided is fast and enquires are resolved in no time. I am very satisfied for using this account! Keep going guys!

Christina Loizou
Accountant at Lytria
Rating star

Through our experience with Payset we are happy to say the services provided were accommodated to our needs perfectly and were performed professionally. The support and customer care is fast and efficient, no question or request is left unanswered or unresolved. 10/10

Payments and Risk Manager, CanadaP LTD
Rating star

For the past year, we have worked hand in hand with Payset Limited to assist us with numerous payments related services. At no one time have they failed me, and they have always been on time, making them one of our top reliable business partners.

Clearsky network
Payments Team
Clearsky Network

Getting started is easy

Say Hi

Say hi

Share a few details about your business and leave us your contact info

Get on Board

Get on board

An account executive will guide you through the on-boarding process which is quick and simple

Enjoy using it

Enjoy using it

Log-in to your account to manage your funds 24/7 and enjoy low fees and fast execution

Open account