Auto Amazon Links: No products found. Blocked by captcha.
In a discouraging turn of events for supermarkets, retail sales plummeted in May at the quickest rate in over a year, according to official figures. The Office for National Statistics (ONS) reported a 2.7% decline in sales volumes for the month, marking the largest monthly drop since December 2023. The dip in sales was attributed to reduced purchases of alcohol and tobacco at food retailers, as well as sluggish trading at clothing and household goods stores.
On the economic front, the UK saw government borrowing increase last month to the second highest level for May since records began in 1993. Borrowing, which reflects the gap between spending and tax income, reached £17.7 billion in May, up £0.7 billion from the same period last year. The ONS noted that while revenue from income tax and National Insurance contributions rose, spending experienced a more significant increase, partially due to inflation-driven benefit upgrades.
The drop in retail sales in May contrasted with a 1.3% surge in April, when favorable weather boosted consumer demand. ONS senior statistician Hannah Finselbach attributed May’s lackluster performance to a challenging month for food retailers, particularly supermarkets, following strong sales in April. Consumers were reported to be scaling back on purchases of alcohol and tobacco. Additionally, demand for DIY goods declined as customers completed home improvement projects earlier than usual due to the pleasant weather. Despite the monthly setback, sales volumes for the three months leading up to May were up by 0.8% compared to the previous quarter, providing insight into underlying trends.
Chief UK economist at Capital Economics, Paul Dales, interpreted the data as indicative that the earlier economic growth spurt has subsided. The economy of the UK, which expanded by 0.7% in the first quarter, contracted by 0.3% in April. Dales highlighted the impact of fading warm weather from April on retail sales in May, in addition to consumer cutbacks prompted by inflation. Jacqueline Windsor, head of retail at PwC UK, emphasized the fragility of consumer spending power and the retail sector in the current economic climate
Read the full article from The BBC here: Read More
Auto Amazon Links: No products found. Blocked by captcha.