‘Stark slowdown’ in retail sales after summer peak, figures reveal
Sales were down 0.8% compared with August but up 1.2% on the previous quarter, according to the Office for National Statistics.
Retail sales fell in September as shoppers cut back their spending on food after a bumper summer, figures show.
Sales were down by 0.8% compared with August, mainly due to a fall of 1.5% in food stores – the largest decline since October 2015, according to the Office for National Statistics (ONS).
Sales still held up in the three months to September with an increase of 1.2% on the previous quarter, largely due to strong growth in watches and jewellery stores, plus online retailers faring particularly well.
Online sales as a proportion of all retailing fell slightly to 17.8% in September from the 18% reported in August, yet food and clothing stores both reported record proportions of internet retail at 5.8% and 18.2% respectively.
Sales were up 3% on the same time last year but the figure fell short of economists’ forecasts of a 3.6% rise.
ONS head of retail sales Rhian Murphy said: “Retail continued to grow in the three months to September with jewellery shops and online stores seeing particularly strong sales.
“This was despite a stark slowdown in food sales in September following a bumper summer.”
Ben Brettell, senior economist at Hargreaves Lansdown, said: “It looks like consumer spending – along with the weather – peaked in early summer and has been declining ever since.
“Where we go from here is highly uncertain. Brexit is hitting consumer confidence hard but on the plus side wage growth has hit a decade high while inflation is falling.
“So consumers look likely to have more spending power – the issue is whether they choose to use it or keep their powder dry until more clarity over Brexit emerges.”
Although the dip in food sales from August is eye-catching, it was expected given the exceptional performance achieved over the summer and shouldn’t cause undue concern Ian Gilmartin
Ian Gilmartin, head of retail and wholesale at Barclays Corporate Banking, said: “It’s still tough out there for the UK’s retailers so solid 3% growth compared with last September is welcome news despite being slightly below expectations.
“Although the dip in food sales from August is eye-catching, it was expected given the exceptional performance achieved over the summer and shouldn’t cause undue concern.
“Retail chief executives will be hoping to see some white smoke from Westminster and Brussels as soon as possible and for solid assurances that they will be able to maintain their existing supply chains and frictionless trading arrangements with EU partners and consumers.”