UK retail sales plunged before new government’s budget, ONS says
2024.11.22 02:42
LONDON (Reuters) -British retail sales fell by much more than expected in October, according to official data that added to other signs of a loss of momentum in the economy in the run-up to the first budget of Prime Minister Keir Starmer’s new government.
A Reuters poll of economists had forecast a monthly fall of 0.3% in sales volumes from September.
The drop was the sharpest since June when sales fell by 1.0% from May. A monthly rise in sales in September was also revised down to 0.1% from a previous estimate of a 0.3% gain.
Sterling fell by about a fifth of a cent against the U.S. dollar immediately after the data before recovering.
The Office for National Statistics said retailers across the board reported that consumers held back on spending ahead of the new government’s first tax and spending budget on Oct. 30.
It also said a possible contributor to the weakness in sales were the school half-term holidays for England and Wales which typically fall within the October data reporting period but did not this year.
Sales of clothing were particularly weak in October, something reflected in previously released figures for the month from the British Retail Consortium, representing the industry, which linked the fall to weather that was warmer than usual.
The ONS said during the 12 months to October, sales volumes rose by 2.4%, slowing from September’s 3.2% rise and weaker than the median forecast in the Reuters poll for a 3.4% increase.
