Retail sales volume in Britain estimated to have fallen by 0.4 percent in November

Retail sales volume in Britain is estimated to have fallen by 0.4 percent in November despite Black Friday shopping events, as non-store retailing sales volumes fell by 2.8 percent, statistics show.

Retail sales fell overall in November, driven by a notable drop for online retailers, with Black Friday offers failing to provide their usual lift in this sector, said Darren Morgan, director of economic statistics at the Office for National Statistics (ONS).

However, department stores and household goods shops did report increased sales, with these retailers noting a longer period of Black Friday discounting helped boost sales, Morgan added.

Food and alcohol sales were also up, with consumers stocking up early to try to spread the cost of Christmas festivities, he said.

The drop in retail sales in November suggests that consumers are buckling under the pressure of surging inflation, despite additional government support for their energy bills, commented Gabriella Dickens, senior economist at Pantheon Macroeconomics consultancy.

Britain’s twelve-month Consumer Price Index was 10.7 percent in November, down from the 41-year high of 11.1 percent in October but still well above the official target of 2 percent.

“While we think inflation has already reached its peak, high inflation and high interest rates will continue to squeeze real spending power and keep retail sales volumes subdued in the coming months,” said Olivia Cross, an assistant economist at Capital Economics consultancy.

Also on Friday, a survey conducted by the market research company GfK showed the United Kingdom’s (UK) consumer confidence index in December reached minus 42 and still neared historic lows after it touched bottom at minus 49 in September.

December marks the eighth month in a row in which the index has bumped along at minus 40 or worse, the first time this has happened since the records began nearly 50 years ago, said GfK client strategy director Joe Staton.

“Real wages are falling as inflation continues to bite hard, further straining the discretionary budget of many households as we enter the last few shopping days before Christmas,” Staton added.

The two survey results on Friday added to concerns that the UK economy might have entered a recession. Britain’s central bank, the Bank of England, on Thursday said it expected the UK economy to decline by 0.1 percent in the fourth quarter, after an estimated 0.2 percent contraction in the third quarter.

“2023 is expected to be an exceptionally tough year for the UK economy. The UK is almost certainly already in a year-long recession, one that will probably prove to be deeper than that experienced in the early 1990s,” said Tom Pugh, an economist at business advisory firm RSM UK. ■


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