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UK Retail Sales Fall as Consumers Driving Growth Take Breather

Published on Nov 19 2015 11:45 AM in Retail tagged: Retail / UK / shoppers

UK Retail Sales Fall as Consumers Driving Growth Take Breather

UK retail sales fell more than economists forecast last month as consumers took a breather after going on a spending spree in September.

Sales volumes declined 0.6 per cent from September, the Office for National Statistics said in London on Thursday. That was more than the 0.5 per cent decrease economists had forecast in a Bloomberg survey. Excluding auto fuel, sales dropped 0.9 per cent, also more than predicted.

The decline followed a 1.7 per cent jump in total sales in September, the biggest increase in almost a year, as Britons took advantage of promotions surrounding the Rugby World Cup and warm weather. Record employment, improving wages and negative inflation are putting money in the pockets of consumers, which is likely to sustain consumer spending.

Consumers remain "the main engine of growth" and can withstand a forecast pickup in inflation next year, said Alan Clarke, an economist at Scotiabank in London. "The UK consumer has reason to be happy and optimistic. The first interest-rate hike has been pushed back and back, and when rates do go up it’s been promised it will be gradual, so life doesn’t get much better."



Food sales fell 1.3 per cent, while non-food sales declined 0.3 per cent, the ONS said. Clothing and footwear and household goods posted the biggest declines, falling 1.8 per cent and 0.8 per cent respectively. Sales of auto fuel rose 1.7 per cent.

Overall sales rose 3.8 per cent from a year earlier and were 0.9 per cent higher in the three months through October, the same pace of growth as in the third quarter.

News by Bloomberg, edited by ESM. To subscribe to ESM: The European Supermarket Magazine, click here.

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