UK retail sales see a decline in October after a period of growth, largely due to budgetary uncertainty and unusual weather conditions.
- According to the Office for National Statistics (ONS), sales dropped by 0.7% in October, reversing a modest increase of 0.1% in September.
- Clothing stores experienced a significant downturn, with sales falling by 3.1%, as warm weather reduced the need for seasonal purchases.
- Food stores also reported a slight decrease in sales volumes, with online sales declining by 1.2% overall.
- Industry experts highlight consumer hesitation ahead of the budget and early Christmas shopping trends as contributing factors.
The latest data from the Office for National Statistics (ONS) reveal that UK retail sales fell by 0.7% in October, following a slight increase of 0.1% in September. Uncertainty surrounding the fiscal agenda coupled with warmer-than-usual weather contributed to reduced consumer spending during this period.
Non-food stores, in particular, saw a turnover decline of 1.4%, a stark contrast to the 2.3% increase reported in the previous month. This downturn occurred across various sectors, with clothing outlets witnessing a 3.1% drop, as consumers deferred purchases due to the mild weather.
Food retailers faced a marginal decrease of 0.6% in sales. Online retail platforms, which have previously shown resilience, were not immune to this downturn, recording a 1.2% drop in sales. This decline was most pronounced among non-food retailers.
Commenting on the situation, Hannah Finselbach, a senior statistician at the ONS, noted that while retail sales are rising on a broader timeline, they remain below pre-pandemic levels. The October decline is rooted in a particularly challenging month for clothing retailers amidst budget uncertainties.
Lisa Hooker, an industry leader at PwC, emphasised the impact of diminishing consumer sentiment and budgetary apprehensions at the close of October. She observed that such factors negatively influenced consumer spending at the outset of the crucial holiday shopping season. However, Hooker suggested a potential recovery, citing the absence of drastic personal tax increases in the recent budget, which might sustain consumer financial capacity in the short term.
October’s retail sales downturn reflects the complex interplay of economic and seasonal variables impacting consumer behaviour.
