by Andy Bruce
LONDON, Sept 16 (Reuters) – UK retail sales fell more than expected in August, adding to recession fears as the cost of living crisis slashes household purchasing power, data show published Friday by the National Statistics Office (ONS).
Retail sales fell 1.6% month on month in August, the steepest decline since December 2021, when economists polled by Reuters on average expected a drop of 0.5%.
These data add to existing concerns about buying behavior among UK consumers. Fashion retailers Primark and ASOS and online supermarket Ocado Retail all warned this month of the impact of inflation on their profits.
“With a tough winter ahead, retailers will be concerned that consumers have already curbed their spending despite the summer heat,” said Lynda Petherick, head of retail at Accenture.
All major retail sectors – food stores, non-food stores, non-store retail and fuel – fell in the month for the first time since July 2021, when restrictions amid COVID-19. 19 on hospitality were raised, the ONS said.
The mourning following the death of Queen Elizabeth II also poses another challenge for retailers, with widespread closures of businesses scheduled for Monday to mark the sovereign’s funeral.
“The gloomy atmosphere in the UK this week and news of slow economic growth will add to retailer’s sense of anxiety as the weather cools,” the analyst said.
Although inflation in Great Britain slowed slightly in August to 9.9% year on year, households are still faced with soaring prices, particularly those of energy, following the invasion of Ukraine by Russia.
(Contributed by James Davey; French version Diana Mandi, spoken by Kate Entringer)