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UK retail sales slide in worst September since 1995, industry data shows

‘Ongoing Brexit uncertainty is clearly having a material impact on the consumer psyche,’ says Paul Martin at KPMG

Olesya Dmitracova
Economics and Business Editor
Monday 07 October 2019 14:48 BST
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Demand for ranges of autumn clothing was dented by warm weather in September
Demand for ranges of autumn clothing was dented by warm weather in September

Total retail sales fell 1.3 per cent last month from a year ago, marking the worst September since 1995 when the British Retail Consortium (BRC) and KPMG started collecting the data.

On another measure – which strips out changes in retail space such as new store openings as well as closures over the past year – sales fell by a steeper 1.7 per cent and much more than forecast by economists.

Online sales, excluding food, rose but only by 0.7 per cent, the slowest growth on record. According to less timely official data, online sales have been growing strongly compared with 2018 until at least August, the last month covered by the Office for National Statistics (ONS).

“Ongoing Brexit uncertainty is clearly having a material impact on the consumer psyche,” said Paul Martin, UK head of retail at KPMG.

Helen Dickinson, BRC chief executive, agreed, noting that many consumers held off from non-essential purchases or shopped around for bigger discounts. Out of 13 product categories in the BRC figures, only sales of food and household appliances showed growth on either measure.

Demand for new ranges of autumn clothing was also dented by warm weather in September, Ms Dickinson said.

“With four months of negative sales growth since March, the ongoing political gridlock surrounding Brexit is harming both consumers and retailers,” she added.

“Clarity is needed over our future trading relationship with our closest neighbours, and it is vitally important that Britain does not leave the EU without a deal.”

Retail sales and broader consumer spending have been a bright spot in an otherwise fragile UK economy this year. However, year-on-year growth in retail sales has slowed sharply from a peak in March to stand at 2.7 per cent in August, according to data.

On the less volatile three-month measure, retail sales inched up only 0.6 per cent in the three months to August compared with the previous three months, the ONS said. That was only a slight improvement on July’s 0.5 per cent rise, which was the weakest increase since December.

The BRC-KPMG Retail Sales Monitor covered five weeks between 25 August and 28 September.

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