MNI DATA IMPACT: UK Consumers Show Caution In October>

By Laurie Laird and Irene Prihoda

     LONDON (MNI) - UK consumers are showing signs of caution, raising 

questions over the sustainability of one of the strongest areas of the 

economy over the past year . 

     The following are the key points from retail sales data 

published Thursday by the Office for National Statistics.

     - Retail sales slipped by 0.1% in October, falling short of 

expectations, the third consecutive month of flat or declining growth. 

That's the longest stretch of weakness since the three months to January 

of 2017.  

     - Over the three months to October, sales increased by just 0.2%, 

the weakest growth since April of 2018.  All major non-fuel retailing 

sectors recorded a fall between September and October, with the 

exception of department stores, where sales rebounded modestly following 

two months of decline. 

     - Retail sales comprise only 5.4% of GDP, but account for 

approximately one-fifth of total consumption, which has provided one of 

the few catalysts for economic growth over the past two quarters. Early 

signs of a consumer slowdown could suggest weaker economic growth in the 

fourth quarter.  

     - Sales at household goods stores suffered a 1.3% monthly decline, 

the biggest laggard amongst the retail sectors. On an annual basis, 

household good sales slumped by 3.7%, the fourth consecutive 

year-on-year fall.  

     - A National Statistics official was unable to link the softness in 

household good sales with either the weakness in the housing market or 

caution toward splashing out on big ticket items. 

     - Internet sales rebounded in October to 0.8% on a monthly basis 

following two successive month of decline. Moreover, internet sales as a 

proportion of all retailing edged higher to 19.2% in October after 

having declined in the previous three months.  

     - Retail price pressures remained subdued, with the implied 

deflator rising by just 0.1% in October, smallest increase in three 

years. A 2.9% annual fall in fuel prices accounted for some of the 

decline in retail prices, but retailers did admit to having to stage 

promotional offers in October, according to a National Statistics 

official. 

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

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