London, July 19, 2024: UK retail sales fell by 1.2% in June from the previous month, according to figures released by the Office for National Statistics (ONS) on Friday. This marks a reversal from the 2.9% increase recorded in May.
Economists polled by Reuters had expected a slight decline of 0.4%. Year-on-year, sales were down 0.2%.
Despite the June sales decline, it is worth noting that wages in the UK are currently growing faster than inflation. Inflation has slowed in recent times and fell to the Bank of England’s 2% target last month. However, underlying inflationary pressures remain strong, which is dampening consumer spending and suggesting that the central bank is unlikely to cut interest rates at its next meeting on August 1.
Key Points:
- The June sales decline was partly attributed to a fall in clothing and food purchases.
- Online sales, however, remained strong.
- Consumer confidence remains weak due to rising energy and food prices.
- The central bank will continue to monitor developments in inflation and wages to determine whether to adjust interest rates.
Table: UK Retail Sales (seasonally adjusted)
| Month | Month-on-month | Year-on-year |
|---|---|---|
| May 2024 | +2.9% | +0.9% |
| June 2024 | -1.2% | -0.2% |
Sources:
- Office for National Statistics (ONS)
