MNI DATA ANALYSIS: UK Aug Retail Up; Poised To Lift Q3 GDP>

-UK Aug total sales +0.3% m/m, +3.3% y/y

-UK Aug non-fuel sales +0.3% m/m, +3.5% y/y

-UK Aug retail prices +2.2% y/y vs +2.1% in July; ex-fuel +1.3% y/y

By Jamie Satchi and Laurie Laird

     LONDON (MNI) - Retail sales volumes rose unexpectedly in August, 

following an upwardly-revised increase in July, leaving the sector 

poised to exert a significant boost on gross domestic product in the 

second quarter. 

     Sales volumes increased by 0.3% between July and August, exceeding 

the MNI median forecast of a 0.3% decline. On an annual basis, retail 

sales jumped by 3.3%, compared to the MNI median gain of 2.2%. 

     July sales were revised to show a 0.9% monthly increase and a 3.8% 

annual gain, better than the originally-reported 0.7% monthly increase 

and 3.5% yearly improvement. 

     That means volumes could plunge by a record 3.6% in September and 

still leave third quarter sales on level pegging with the second quarter 

outturn. The retail sector accounts for 5.4% of total output. 

     Supermarket sales slipped by 0.6% in August, falling back from a 

warm-weather inspired July rise. Every other sector posted a gain on the 

month, with the exception of clothing, which fell by 1.9%. The balmy 

weather in August discouraged shoppers from indulging in the latest 

autumn lines, according to the latest results from retailers. 

     Sales at household goods stores outperformed, rising by 4.5% in 

August and by 10.8% over the same period of 2017, led by heavy 

discounting of furniture and household appliances, according to a 

National Statistics official. 

     The implied price deflator rose by 2.2% in the year to August, the 

twenty-second straight increase, but below the peak of 3.3% recorded in 

September of 2017. 

     Fuel prices accounted for much of the acceleration in retail 

inflation, jumping by an annual rate of 11.3%, in line with the recent 

rise in crude oil prices. Excluding fuel, the implied deflator rose by 

1.3%, up from 1.1% in July. 

     Excluding fuel, sales rose by 0.3% last month, or by 3.5% compared 

with August of 2017, above the MNI median forecast of a 0.4% fall on the 

month and a 2.8% annual gain. 

     July non-fuel sales were also stronger than originally reported, 

rising by a revised 1.1% from June and increasing by 4.0% over July of 

2017. Excluding fuel, sales growth was originally reported as up 0.9% 

between June and July and up 3.7% over the seventh month of 2017. 

     Over the year to August, internet sales rose by 0.7% in value terms 

to a seasonally-adjusted 18.2% of all sales, matching the record high 

recorded last month. 

-London bureau: 44 (0) 203 865 3812; email: ukeditorial@marketnews.com

[TOPICS: M$B$$$,MABDS$]