Published: November 20, 2023 5:11 am
Author: RT
The decline is blamed on consumers cutting back their spending
UK retail sales fell unexpectedly in October, with the volume of goods sold in stores and online slumping 0.3% month-on-month, the Office for National Statistics (ONS) reported on Friday.
Economists were expecting an increase of 0.4% for the month of October. Instead, sales plummeted to their lowest level since early 2021, when Covid restrictions were in place. Compared to last year, October sales were 2.7% lower, data shows.
The report also highlighted that the October drop followed a revised 1.1% decline in September that was worse than first estimated.
Both economists and retailers blame the cost-of-living crisis and bad weather for the poor performance.
“Weather effects from the particularly wet second half of the month are said to have played a role in reducing footfall, on the heels of what had been an unusually warm September and early October,” Sandra Horsfield, an economist from Investec bank, said in a research note, as quoted by the Guardian. “This may well not only have deterred purchases of autumn/winter clothing ranges but kept consumers out of shops more generally,” she argued.
READ MORE: British shoppers limit spending
The bleak figures suggest there is a growing risk that the British economy has stagnated, and GDP could yet be revised lower to a negative reading, Horsfield added.
“In any case, we remain of the view that a winter recession looks likely, as higher interest rates gradually feed through and take their toll on household and business finances,” said the economist.
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