MNI DATA: UK Sales Expose January False Dawn: KPMG-BRC

--UK Feb Total Retail Sales 0.5% Y/Y Vs Jan 2.2%

By Jai Lakhani

     LONDON (MNI) - The pace of UK consumer spending reversed from its

acceleration in January, a survey published Tuesday showed. 

     The British Retail Consortium Retail Sales Monitor reported February

like-for-like sales down 0.1% on year. The reading rose by 1.8% y/y in January. 

     Total shop sales were up modestly by 0.5% in February. A noted drop from

January's 2.2% rate, which was the highest reading since June. Therefore it was

unsurprising the reading was below the 3-month and 12-month averages of 0.9% and

1.2% respectively. 

     --MODERATION

     Brexit was again to the fore, making itself heard as the willingness of

households to spend remains lacklustre at best. 

     "Uncertainty surrounding the UK's imminent exit from the European Union has

hit consumer spending," Helen Dickinson OBE, Chief Executive, British Retail

Consortium said. 

     The increasingly popular online segment of sales continued to moderate in

February with online sales of non-food products growing 5.4%, against growth of

6.4% in February 2018. However, overall online penetration rose to 29.6% from

27.5% last year. 

     "With consumers increasingly aware of the risk of a no deal Brexit, it is

likely that uncertainty has driven this cautious approach to retail spending. If

government wishes to reassure both the public and businesses, they should ensure

a chaotic no deal - which would lead to higher costs, higher prices, and less

choice for consumers - is taken off the table with immediate effect," Dickinson

added. 

     --FOOD SALES STRONG 

     The top performers were computing, household appliances and goods. Whilst,

furniture performed well in January, February was a different story with

furniture sales growth second last. 

     "Following a modest recovery in January, February saw a slowdown in sales.

While consumer spending has so far remained relatively resilient, driven by

factors such as low unemployment and wage growth, it would seem that continuing

political and economic uncertainties are beginning to notably affect shoppers'

spending habits," said Paul Martin, UK Head of Retail at KPMG. 

--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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