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Retail sales suffer sharpest fall in six months - but Brexit not to blame

Published 21/07/2016

June sales growth slowed to 4.3%, according to the ONS
June sales growth slowed to 4.3%, according to the ONS

UK retail sales have suffered their sharpest fall in six months but June's poor weather rather than Brexit uncertainty is to blame, according to the Office for National Statistics (ONS).

The ONS said there had been no anecdotal evidence from retailers of any Brexit impact for the latest reporting period stretching over five weeks to July 2, which saw the quantity of retail sales decrease by 0.9% compared with May.

The dip was bigger than economists' forecasts of 0.6% after rising by an above-average 0.9% in May.

Compared with a year earlier, June sales growth slowed to 4.3% from 5.7% in May.

Average store prices, including petrol stations, were down 2.5% on a year ago, and the amount spent was up 1.5% over the same time and down 0.9% compared with the month before.

The value of online sales increased by 14.1% on a year ago, and 0.5% on May.

Department stores received a boost from sales around the Euro 2016 football tournament and the Queen's 90th birthday but clothing retailers suffered during the rain-soaked month.

Melanie Richard, ONS head of retail sales, said: "All store types showed growth in June with the exception of clothing and footwear which struggled again due to the changeable weather.

"But there was continued strong sales in department stores compared with last June, which were boosted by events such as Father's Day, the Euro 2016 football tournament and the Queen's official birthday."

Ian Geddes, UK head of retail at Deloitte, said: "While many will look for the negatives, these are essentially very positive results.

"In a week when the country has been scrabbling for shade, it is easy to forget June's damp start to summer. This could have been damaging to retailers' prospects, and we have already seen deep discounts from those hoping to shift unsold stock.

"Despite the rain and England's early exit from the Euros, the UK retail industry has remained remarkably resilient. Retailers will be buoyed by consumers' 'keep calm and carry on' approach."

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From Belfast Telegraph