UK Retail Sales Fall 0.9 Percent in June

UK retail sales suffer their biggest fall in six months, reflecting low consumer spending prior to the June 23 referendum vote.

The volume of goods sold at retail level fell 0.9 percent in June, more than 0.6 percent forecast by economists, the Office for National Statistics reported on Thursday.

Food sales dropped 1.2 percent, while non-food sales fell 0.8 percent. Sales at departmental stores reportedly fell 1.6 percent, clothing and footwear retailers saw a decline of 1.8 percent.

Year-on-year, June sales slowed to 4.3 percent from 5.7 percent in May.

The survey was conducted between May 29 and July 2, meaning the larger responses were received before Brexit vote.

On Wednesday, the Bank of England said survey polls showed consumer confidence drop to over 20 years low.

While other analysts have said this report reflect the Brexit effect since it is the only post-Brexit report, it reflects more of speculators perception of post-Brexit, and may be too early to draw conclusion from.

Total sales in the second quarter revealed retail sales were up.4.9 percent year-on-year, when compared with 4.1 percent growth in the first quarter, the best since the first quarter of 2015.

Consumer spending still remains the major driver of the UK economy and a substantial plunge in spending could tip the economy into recession if BoE monetary policy fail to materialize.

About the Author

Samed Olukoya
CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya; Email: [email protected]

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