UK Retail Sales Growth Tops Expectations
October 22 2020 - 11:43PM
RTTF2
UK retail sales grew for a fifth consecutive month in September
and exceeded expectations by a wide margin supported by food and
online sales as well as a recovery in non-food sales, preliminary
data from the Office for National Statistics showed on Friday.
The volume of retail sales grew 1.5 percent month-on-month in
September, which was much bigger than the 0.4 percent increase
economists had forecast.
The growth for August was revised up to 0.9 percent from 0.8
percent.
Sales excluding fuel rose 1.6 percent monthly, exceeding the
forecast for 0.5 percent growth, after a 0.6 percent increase in
August.
Retail sales were 5.5 percent higher compared to February's
pre-pandemic level, ONS said.
Food stores sales grew for a second month, by 0.7 percent after
a 0.4 percent increase in the previous month.
Non-food store sales grew 4 percent after a 3.2 percent increase
in August, led by a 7.3 percent growth in household goods sales.
Fuel sales rose just 0.1 percent.
The proportion of online sales was at 27.5 percent in September
versus 20.1 percent in February. This was despite small monthly
declines across most of the retail sector.
The share of online sales by food stores nearly doubled to 10.4
percent in September from 5.4 percent in February.
"Food stores and online retailers have fared particularly well
in recent months and most other store types have now recovered to
pre-pandemic levels too after being subject to temporary closures
during restrictions in the spring," ONS statistician Jonathan Athow
said.
Spending on home improvement and gardening items in particular
have boosted sales, the ONS official said.
Athow also said that clothing store sales have been slower to
recover and fuel sales remain subdued as people continue to work
from home and have reduced the amount the travel.
On a year-on-year basis, retail sales increased 4.7 percent in
September following a revised 2.7 percent growth in the previous
month. Excluding fuel, retail sales rose 6.4 percent after a 4.3
percent growth in August.
Economists had forecast 3.7 percent and 5 percent gains,
respectively.
Meanwhile, the resurgence of coronavirus infection suggest
economic activity is likely to be hurt again in the coming
months.
"While retail is unlikely to be as badly affected as other
sectors by the Covid-19 resurgence, the deteriorating outlook is
nevertheless another reason to think the post-lockdown
recovery in UK economic activity has reached its limit," ING
economist James Smith said.
ING expects October monthly GDP to record a contraction.
Euro vs Sterling (FX:EURGBP)
Forex Chart
From Aug 2024 to Sep 2024
Euro vs Sterling (FX:EURGBP)
Forex Chart
From Sep 2023 to Sep 2024