U.K. Retail Sales Unexpectedly Fall in Worst Run Since 1996
The volume of goods sold in stores and online fell 0.6%, the largest decline this year, the Office for National Statistics said.
(Bloomberg) --
U.K. retail sales posted a surprise fall in November, marking a fourth straight month without growth for the first time since at least 1996.
The volume of goods sold in stores and online fell 0.6%, the largest decline this year, the Office for National Statistics said Thursday. Economists had expected a 0.2% increase. Sales excluding auto fuel also dropped 0.6%.
The headline measure has now failed to increase since July, the longest period without an expansion since the ONS’s records began 23 years ago. It means sales will drag on fourth quarter growth barring a robust 1.5% increase in December.
The figures cover the period between Oct. 27 and Nov. 23, meaning the Black Friday and Cyber Monday sales will instead fall within the December report. The ONS said it was confident that its seasonal adjustment process had accounted for the shift in timing.
In a separate report, the Confederation of British Industry said sales in December were “poor for the time of year” and that stocks were reported as being too high relative to demand. The lobby group said its measure of sales volumes stood at zero, indicating business was little changed from a year earlier.
Sales fell across the board last month, the ONS said, with the exception of household goods. Food sales fell 0.6% and spending at department stores dropped 1.4%, while non-store retailing declined 1.7%.
Tough Year
In the three months through November sales fell 0.4% from the previous period, the first such decline since April 2018.
The figures are a continuation of a tough year for U.K. retailers, who have been hit by a double whammy of political uncertainty and the rise of online shopping. The high street’s troubles have caused high-profile damage, with a number of stalwarts either closing stores or collapsing into insolvency.
The report may also provide evidence of consumer jitters going into December’s election, which ultimately resulted in Prime Minister Boris Johnson winning a decisive majority, clearing the way for the U.K. to leave the European Union on Jan. 31.
The data come as the Bank of England prepares to announce its last interest-rate decision of the year at noon. The central bank is expected to keep interest rates on hold at 0.75%, but most analysts expect Michael Saunders and Jonathan Haskel to repeat their calls for an immediate cut.
On an annual basis, sales grew just 1%, the weakest pace since April 2018. Online spending accounted for 21.5% of total spending in the period.
--With assistance from Jill Ward.
To contact the reporter on this story: David Goodman in London at dgoodman28@bloomberg.net
To contact the editors responsible for this story: Paul Gordon at pgordon6@bloomberg.net, Andrew Atkinson
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