MNI 5 Things: UK Retail Decline Raises Fears of Consumer Slump

By Laurie Laird, Jamie Satchi and Jai Lakhani

     LONDON (MNI) - The following are the key points from retail sales data

published Thursday by the Office for National Statistics.

     - An unexpected fall in retail sales adds to the growing body of evidence

that strong Q3 growth could be an aberration. Sales volumes declined by 0.5%,

confounding analysts' expectation of a small rise.

     - Fuel sales reversed by 1.2% in the month of October, the fourth

consecutive decline, shaving 0.2 percentage points from total growth. Fuel

prices increased by 0.6% in October, or by an annual rate of 11.4%, the 26th

straight annual rise.

     - Household good sales retreated by a monthly rate of 3.0%, as

heavy-discounting in previous months proved to be unsustainable, as highlighted

by MNI. A National Statistics official downplayed any link between weak

household goods sales and the slowing property market.

     -There was no concrete evidence of consumers delaying purchases awaiting

Black Friday promotions due next week. The evolving nature of these promotions

has in previous years distorted consumer behaviour, complicating the seasonal

adjustment.

     - Food sales increased by 0.4% in October, led by early Christmas buying at

specialised stores. Changing patterns of pre-holiday buying may be distorted by

seasonal adjustment factors derived from shorter seasonal buying patterns.

--MNI London Bureau; +44 203-586-2226; email: jamie.satchithanantham@marketnews.com

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