Observer raises price to pounds 1

The Observer will increase its price from 90p to pounds 1 tomorrow, in spite of a 26,000 fall in circulation last month compared with November last year.

The Guardian, owner of the Observer, spent several million pounds relaunching its Sunday sister newspaper in September. Sales at first improved, but have since fallen 5.1 per cent below the level they were at during the same period last year.

By contrast, the Independent on Sunday recorded a 4.1 per cent increase compared with the same month in 1994, the largest increase among broadsheet Sunday newspapers. Last month the Independent's Sunday sister sold an average of 327,526 copies.

The Guardian's Saturday price will also rise next week, by 10p to 60p. That will make the Guardian 10p more than the Independent on Saturdays. It is already 10p more than the Independent on weekdays.

The news follows significant gains in circulation for the Independent over the past year. Audit Bureau of Circulation figures for November show average daily sales of 293,777, which is 3,500 (1.4 per cent) better than the same month last year.