Jun 15, 2017
UK retail sales fall sharply but fashion stores fare better
Jun 15, 2017
British retail sales fell more sharply than expected in May, data showed on Thursday, the latest sign of the growing hit to the economy from rising inflation since the Brexit vote. But there were signs that fashion sales held up better than expected.
Even before last week's election which left the country without a majority government and facing political uncertainty, retail sales volumes fell 1.2 percent month-on-month in May, a heavier downturn that the median forecast for a fall of 0.8 percent in a Reuters poll of economists. The fall followed an unexpectedly strong jump in April which economists had said was likely to prove a blip.
British households have been pinched by a rise in inflation, caused in large part by the fall in the value of the pound since last year's referendum decision to leave the European Union, and by a slowdown in pay growth.
"Increased retail prices across all sectors seem to be a significant factor in slowing growth," ONS statistician Kate Davies said about May's weaker-than-expected sales volumes.
Compared with a year earlier, retail sales rose 0.9 percent compared with economists' forecasts for a 1.7 percent rise, the joint weakest increase since April 2013. And the retail price deflator - a gauge of inflation in stores - edged up to 3.2 percent.
But while non-food dips were the biggest issue last month, the ONS figures showed specialist textile, clothing and footwear store volumes 4.3 percent ahead with value sales up 7.5 percent as store prices rose 3 percent. Spending in such stores acocunts for 28 percent of all non-food spending.
Online sales proved strong in May too with their volumes up 11.7 percent and their values rose 16.1 percent to continue an ever-lengthening run of sales increases.
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