Retail

UK Retail Up 0.6 Percent Despite Bureaucratic Instability

U.K. shoppers

October retail spending was up 0.6 percent in the U.K. compared to October 2018, in spite of the turmoil over Brexit and the upcoming general election, the Financial Times reported on Monday (Nov. 4).

This is the greatest growth since April and more than the 0.1 percent increase in the 12 months leading up to October, according to data by the British Retail Consortium and accounting firm KPMG.

“After several disappointing months, any tiny hints of growth are most welcome” Paul Martin, U.K. head of retail at KPMG, told FT. “Retailers have clearly been peddling hard to win over disengaged shoppers, especially given continued Brexit uncertainty.” 

Data from credit card firm Barclaycard indicated that spending on non-essential items, such as non-food retail and leisure activities, was up 2 percent in October year on year. Spending was higher than the 1.7 percent rate of inflation. Essential spending rose 0.2 percent and supermarket spending was up 1.5 percent.

Barclaycard data also indicated that restaurant spending was up 5.5 percent while takeout was up even higher at 6.9 percent. 

High employment and a strong labor market made people feel confident about their personal finances, although 75 percent are worried about the overall economy, Barclaycard data showed. 

October data from the Office for National Statistics indicated that retail sales were up 0.6 percent in the second quarter compared with the first.

“With Brexit still unresolved and a December election creating new uncertainties, retailers will be looking nervously at the months ahead,” Helen Dickinson, chief executive at the British Retail Consortium, told the news outlet.

In the U.S., data from the U.S. Commerce Department showed retail sales in the country were down 30 basis points last month. The news was less than stellar on two fronts, namely that 1) economists had expected gains — to the tune of positive 30 basis points — and 2) the data represented the first drop in seven months.

Sales at furniture and home furnishing stores slipped by 60 basis points. Online retail sales were down by 30 basis points.

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