UK retail sales nudge higher in October
By Abigail Townsend
Date: Friday 18 Nov 2022
(Sharecast News) - Retail sales volumes nudged higher in October, official figures showed on Friday, partially reversing September's fall.
According to the Office for National Statistics, sales rose 0.6% following a fall of 1.5% - revised down from an initial estimate for 1.4% - in September, when shops and businesses closed for the state funeral of Elizabeth II. Analysts had been expecting a rise of around 0.5%.
Increases were seen across all the main sectors apart from food stores, where volumes fell 1%, or 4.1% when compared to pre-Covid levels in February 2020.
Industry data is increasingly showing that consumers, hit hard by the inflation and the cost of living crisis, are switching to cheaper brands and buying less when doing their weekly shops.
Non-food sales volumes rose by 1.1% in October 2022, although they remain 1.7% below February 2020.
Year-on-year, sales fell 6.1%, slightly better than forecasts for a fall of 6.5%, while in the three months to October, sales fell 2.4% against the previous three months.
Gabriella Dickens, senior UK economist at Pantheon Macroeconomics, said: "The partial recovery in retail sales in October is a false dawn. September's retail sales figures were depressed artificially by the Queen's funeral, so a partial recovery always looked likely.
"Retail sales will likely hold their ground over the remainder of 2022, as households' disposable incomes have been boosted by the reversal of April's increase in employees' National Insurance contributions and by the cost of living grant.
"Nevertheless, households will see their incomes hit hard again early next year, as government support starts to wind down."
Victoria Scholar, head of investment at Interactive Investor, said: "The downward trend continues with sales volumes falling by 2.4% in the three months to October, representing the lowest three-month growth rate since March 2021, when the UK economy was in the midst of lockdowns and Covid restrictions."
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