Connect with us

Hi, what are you looking for?


Fall in retail sales suggests faltering economic recovery

Retail sales fell unexpectedly last month in another sign that Britain’s economic recovery is slowing, official figures show.

Sales dropped by 0.2 per cent in September, according to the Office for National Statistics (ONS). This was worse than the 0.5 per cent rise forecast by economists. Despite the fall, retail sales are still 4.2 per cent higher than they were in February last year, before the first lockdown.

The retail sector rebounded strongly from lockdown as the reopening of shops led to a boom in spending on goods. Households are still spending a higher proportion of their income on goods instead of services, such as eating out or holidays. There are signs, however, that they are starting to rebalance their spending habits.

“Household goods were the main driver of this month’s decline with a fall of nearly 10 per cent, while food sales ticked back up after falling last month,” Darren Morgan, an ONS statistician, said.

Retail sales volumes have now fallen for six months in a row, marking the longest period of consecutive monthly falls since the series began in February 1996. They would have fallen more sharply last month were it not for a 2.9 per cent monthly increase in petrol sales as panic-buying took hold across the country. Excluding fuel, retail sales were down 0.6 per cent on the month.

Economists said that the retail sector would continue to struggle over the coming months as rising coronavirus infection rates and widespread shortages would continue to weigh on demand.

Bethany Beckett, economist at Capital Economics, said: “The 0.2 per cent month-on-month fall in retail sales volumes in September offers more evidence that the economic recovery is fast running out of steam . . . Given the backdrop of continued shortages and rising Covid-19 infections, we suspect that retail sales growth will continue to be weak in the coming months.”

Samuel Tombs, economist at Pantheon Macroeconomics, said that consumer spending was likely to suffer as household budgets would be squeezed over the coming months. “Retail sales probably will rebound in October, as consumers purchase Christmas presents earlier than usual due to concerns about product availability,” he said. “Nonetheless, real household disposable income looks set to drop by about 1.5 per cent quarter-on-quarter in Q4 as labour income declines in response to the end of the furlough scheme, universal credit payments are reduced by £20 per week and CPI inflation rises further.

“After a brief respite in Q1, households then will be hit in April by the 1.25 percentage point increase in the rate of employees’ national insurance contributions, which will reduce real household disposable income by about 0.5 per cent, as well as by a 30 per cent increase in Ofgem’s energy price cap.”

Read more:
Fall in retail sales suggests faltering economic recovery

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!



GROSS BORROWINGS by the National Government had reached P2.75 trillion as of end-October as it continued to raise money for its pandemic response, preliminary...


By Luz Wendy T. Noble, Reporter THE PHILIPPINE Statistics Authority (PSA) said the base year for the consumer price index (CPI) will change to...


SOME INDIAN COMPANIES, including those from the pharmaceutical industry, are interested in investing in economic zones in the Philippines, according to an India Business...


By Keren Concepcion G. Valmonte, Reporter HOSPITALITY GROUPS expect a rebound in tourism as coronavirus disease 2019 (COVID-19) vaccination rates continue to improve and...


BUSINESSWORLD’s Luz Wendy T. Noble was recognized as the Best Reporter of the Year for Banking at the 30th annual awards of the Economic...


THE Securities and Exchange Commission (SEC) has flagged eight more entities in separate advisories for their unregistered investment solicitation programs. These offerings are PH...

You May Also Like


Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...


Ivermectin, an existing drug against parasites including head lice, has had a checkered history when it comes to treating COVID-19. The bulk of studies...


As a traditionally rigid insurance industry becomes bogged down by antiquated processes and operations, a handful of industry leaders are seeking to shake things...


Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...

Disclaimer:, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.