UK Analysis: Food Lifts July Retail Sales; Q2 Unrevised>

-UK July total sales +0.3% m/m, +1.3% y/y

-UK Q2 total sales confirmed +1.5% q/q, adding 0.09pp to Q2 GDP

-UK July non-fuel sales +0.5% m/m, +1/5% y/y

-UK July retail prices +2.7% y/y unchanged versus June

 By Laurie Laird and Jamie Satchithanantham

     LONDON (MNI) - Retail activity rose in July, courtesy of a jump in 

food-store sales, while previously-reported robust second quarter sales 

were confirmed.  

     Sales volumes increased by 0.3% between June and July, matching the 

median MNI median forecast. On an annual basis, retail sales rose by 

1.3%, falling just short of the MNI median of a 1.4% improvement. 

     Over the second quarter, retail activity expanded by 1.5%, 

unchanged from data released last month. That means the retail sector, 

which accounts for 5.6% of gross domestic product, added 0.09 percentage 

points to second quarter growth of 0.3%, as reported in the initial 

release of GDP. 

     Over the three months to July, sales volumes rose by 0.6%, down 

from the 1.5% gain reported in June. 

     Activity at predominantly food retailers, which comprises 39.8% of 

total sales, jumped by 1.5% last month, reversing a 1.1% slide in June. 

Supermarkets reported across-the-board sales gains, including renewed 

demand for non-food items such as clothing and footwear and household 

goods, according to a National Statistics official. 

     Sales at non-food stores slipped by 0.1% between June and July, 

with all categories of outlets, except for household goods stores, 

recording a fall in monthly sales volumes. 

     June sales were weaker than originally reported, rising by a 

revised 0.3% from May and by 2.8% over June of 2016, compared to the 

initial estimate of up 0.6% on the month, and an annual gain of 2.9%. 

     The implied price deflator rose by 2.7% in the year to July, the 

ninth straight increase, but below the post-referendum high of 3.3% 

recorded in May. Excluding fuel, the implied price deflator also rise by 

an annual rate of 2.7%. 

     Excluding fuel, sales rose by 0.5% last month, or by 1.5% compared 

with July of 2016, above the MNI median forecast of no change on the 

month and a 1.3% annual gain. 

     June non-fuel sales were also weaker than originally reported, 

rising by a revised 0.6% from May and by 2.8% over June of 2016. 

Excluding fuel, sales growth was originally reported as up 0.9% in June, 

and 3.0% above the same month of 2016. 

     Internet sales values rose by 0.3% in July to reach a total of 

16.0% of all transactions, down from a record-high 16.2% in June. 

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

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