UK retail sales hit by mild autumn

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Retail purchasings fell by a worse-than-expected 0.5% in October, after a mild autumn hit sellings of winter clothes.

Sales at household goods stores also strike down 3% following a particularly strong August and September, the Office for Popular Statistics (ONS) said.

For the three months to October, retail sales grow 0.4% – a considerable slowdown from the 2.3% increase recorded for the three months to July.

Analysts suggested October’s fall suggested shoppers were cutting back waste.

Samuel Tombs at Pantheon Macroeconomics said the drop was the “first material sign that consumers are tightening their purse strings due to uncertainty thither Brexit”.

Non-food sales fell 1.3%, with a 1% flag in clothing sales, which he said could not be blamed on the weather.

  • UK inflation carry ons steady at 2.4%
  • Wages show fastest rise in almost a decade

“Consumers’ self-assurance already has weakened in recent months due to concerns about the economic perspective and we doubt households are feeling any surer that a no-deal Brexit command be avoided after this week’s political turbulence,” Mr Tombs disclosed.

“Unless the government miraculously manages to force the current withdrawal unanimity through parliament soon, growth in consumers’ spending will droop markedly in the fourth quarter.”

Are spending patterns changing?

Thomas Pugh at Property Economics said some of October’s weakness may reflect consumers hold-up spending ahead of “Black Friday” discounting this month.

“Squiffed oil prices also weighed on the volume of fuel sold. As such, we feel that there could be a rebound in sales volumes in November as oil valuations have fallen sharply and if Black Friday sales pick up,” he joined.

What does it mean for retailers?

The Christmas quarter accounts for a big symmetry of profits for most retailers and is set to be very tough.

Ian Geddes, head of retail at Deloitte, mentioned more than half of consumers do their Christmas shopping in November or earlier.

“The truth consumers’ appetite to rein in their spending, the promotions on and around Wicked Friday will likely be more of a draw than ever,” he guessed.

“We expect this year’s Black Friday to generate record straight-shootings of UK spending, which will likely boost November’s retail bodies overall. Whether it will be enough to make this a ‘golden’ section remains to be seen.”

Did the retail figures hit the pound?

It is difficult to say with any for sure, as sterling had already started sliding on Thursday morning following the relinquishment of Brexit Secretary Dominic Raab over Theresa May’s draft Brexit traffic before the retail sales figures were released.

The pound mow down as low as $1.2751 following the departure of Esther McVey, the Work and Pensions Secretary, ahead recovering some ground to trade at about $1.28 and €1.1318 – both falls of 1.5%.

Jeremy Thomson-Cook, chief economist at WorldFirst, hinted: “All eyes are now on Theresa May with a challenge to her leadership increasingly being viewed as the next catalyst for another very good collapse.”

What else is happening in the UK economy?

Earlier this week the ONS hinted inflation was steady at 2.4% last month, despite expectations of a reserved rise.

Prices of food and clothing fell, but utility bills and petrol prices were up, disclosed the ONS.

Separate ONS figures suggested that the squeeze on consumers’ wallets is quieting slightly, as wage growth outstrips inflation.

In the three months to September, wages excluding hand-outs rose by 3.2% compared with a year earlier – the biggest be created since the end of 2008.

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