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Retail

UK Retailers Suffer Worst September On Record: BRC

British retailers endured their worst September since at least the mid-1990s as people instead spent money on entertainment, according to surveys that painted a muted picture of household demand ahead of Brexit.

The British Retail Consortium (BRC) said total retail sales values declined 1.3% in September compared with the same month last year.

Average growth over the last 12 months slowed to 0.2%, the weakest rate since the BRC began its records in 1995.

Broader Consumer Spending

A separate survey published on Monday by payment card company Barclaycard showed broader consumer spending - which includes retail sales - rose 1.6% in annual terms in September.

While official data retail data have painted a healthier picture of consumer demand, surveys like the BRC's have suggested household spending -- one of the few drivers of economic growth this year -- may be starting to wane.

The Barclaycard survey showed 41% of Britons were "actively pessimistic" about their ability to spend on discretionary items, up five percentage points from August.

'Political Gridlock'

"With four months of negative sales growth since March, the ongoing political gridlock surrounding Brexit is harming both consumers and retailers," BRC chief executive, Helen Dickinson, said.

The BRC survey showed spending on non-food items fell sharply as spending on essentials rose. Online sales of non-food items were the worst ever recorded.

By contrast, the Barclaycard report showed spending on entertainment -- which includes cinema, sports and theatre tickets, increased by 4.7% in annual terms in September.

It also showed strong growth in digital services such as Netflix, Spotify and Amazon Prime but confidence in the economy remained uncertain and one in eight consumers were stockpiling Christmas food and drink in the run-up to Brexit.

Both surveys had been due to be published on Tuesday but the BRC brought forward publication and Barclaycard followed suit.

News by Reuters, edited by ESM. Click subscribe to sign up to ESM: European Supermarket Magazine.

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