UK retail sales slow as shoppers tighten belts

UNITED Kingdom retail sales slowed at the start of the year as consumers tightened their purse strings in another sign of tepid economic demand.

Total sales increased 1.2 per cent in January, compared with a three-month average of 1.9 per cent, the British Retail Consortium (BRC) and consultancy KPMG said on Tuesday (Feb 6). The figures are not adjusted for inflation, which was 4 per cent at the end of last year.

“Easing inflation and weak consumer demand led retail sales growth to slow,” said Helen Dickinson, chief executive officer of the BRC. “While the January sales helped to boost spending in the first two weeks, this did not sustain throughout the month.”

Sales of big-ticket items such as furniture and household and electrical appliances remained poor, Dickinson added.

Food sales were more positive, however. With Brits staying at home during two winter storms, grocery volumes saw their “largest year-on-year growth in over 12 months”, according to Sarah Bradbury, CEO at research group IGD.

A separate report from Barclays, also released on Tuesday, showed spending growth at supermarkets rising by 5.2 per cent – up from 2.8 per cent in December – as many consumers cooked meals at home instead of going out. Overall, Barclays said spending on UK credit and debit cards rose just 3.1 per cent. BLOOMBERG