U.K. Retail Sales Better Than Expected in April on Clothing
U.K. Retail Sales Better Than Expected as Online Purchases Climb
(Bloomberg) -- U.K. consumers unexpectedly kept up spending last month as retail sales beat economists’ forecasts.
The volume of goods sold in stores and online was unchanged following three consecutive months of gains, the Office for National Statistics said Friday. Expectations were for a 0.3% drop.
The good news may not last. A separate survey for the month of May by the Confederation of British Industry showed a dismal picture of business conditions for retailers, with investment intentions reaching a record low and employment declining.
Sales in April were boosted by warm weather and a record three-month growth rate for online purchases, the ONS said. Gains in non-store retailing climbed 9.4% in the quarter through April, led by clothing. Sales at department stores and household goods shops declined in the quarter through April. Textile, clothing and footwear sales rose 2.2%, and gained 3% in other stores.
Record employment and rising real incomes are helping to underpin consumer spending, the largest part of the economy, in the face of the crisis over Britain’s departure from the European Union. Sales were up 5.2% from a year earlier, also beating forecasts.
While consumers are helping keep the U.K. economy growing, businesses are cutting spending, fearing an economic slowdown could turn into a slump if the U.K. ends up leaving the EU without a deal to cushion the blow.
The retail figures contrast with the problems flagged by many well-known companies on the British high street. Shares of Thomas Cook Group, which invented the package holiday in Victorian England, plummeted to their lowest in more than seven years on Monday. On Tuesday, celebrity chef Jamie Oliver’s U.K. restaurant business slid into insolvency.
The CBI said volumes for the year to May dropped at their fastest pace since October 2017 as orders and investment plans declined. The only sub-sector to post a rise in sales was non-store retailing, it said.
To contact the reporters on this story: David Goodman in London at dgoodman28@bloomberg.net;Lucy Meakin in London at lmeakin1@bloomberg.net
To contact the editors responsible for this story: Paul Gordon at pgordon6@bloomberg.net, Brian Swint, Jill Ward
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