LONDON • UK retailers made a faltering start to the fourth quarter (4Q) as sales unexpectedly fell for a second month in October.
The volume of goods sold in stores and online declined 0.5% from September, the Office for National Statistics said yesterday. The median forecast in a Bloomberg survey was for a 0.2% gain.
Decline was largest in seven months and followed a 0.4% drop in September. Retail sales excluding auto fuel fell 0.4%. Sales of household goods dropped 3%, clothing sales were down 1% and sales at “other” stores, a category that includes pharmacies, booksellers and computer shops, fell 1.4%.
Mild weather hit winter clothing sales and household goods had done well in previous two months. Decline in sales was partly offset by spending at department stores and food sales, which rose 0.4% in a rebound from a weak September.
The pressure on consumers is easing, with pay growth now running comfortably ahead of inflation. But real pay remains well below its level before the financial crisis and fears that Britain could crash out of the European Union (EU) without a deal are mounting.
Internet retailing is taking a heavy toll on traditional bricks-and-mortar stores. The amount of money spent online has risen sixfold over the past decade and accounted for 18% of total sales in October.
The sales figures were overshadowed by the resignation yesterday of Brexit Secretary Dominic Raab in protest at Prime Minister Theresa May’s deal to leave the EU.