Retail sales in the UK showed signs of recovery in November, albeit to a lesser extent than anticipated, as consumer sentiment remained subdued due to the country's ongoing cost-of-living crisis and economic uncertainties. Britain's retail sales increased by 0.2% month over month in November, reversing the 0.7% decline seen in October, as reported by the Office for National Statistics on Friday.
However, this latest figure fell short of the consensus estimate of a 0.5% growth. The ONS noted that this data does not account for Black Friday sales on November 29, which fell outside the reporting period from October 27 to November 23. On a year-over-year basis, retail sales were up 0.5%, compared to a revised 2% increase earlier and a market forecast of a 0.8% rise. When excluding automotive fuel, retail sales saw a monthly growth of 0.3% and an annual increase of 0.1%, contrasting with a 0.9% decline and a revised 1.6% jump in previous readings.
Analysts had expected no growth month over month and a yearly gain of 0.7%. Hannah Finselbach, a Senior Statistician at ONS, stated, "For the first time in three months, there was a boost for food store sales, particularly supermarkets. It was also a good month for household goods retailers, most notably furniture shops.
Clothing store sales dipped sharply once again, as retailers reported tough trading conditions." ONS data indicated that food store sales volumes rose by 0.5% in November, marking the first increase in three months. The total sales volumes for department, clothing, household, and other non-food stores also increased by 0.2%, attributed to a boost from other retail sales segments. In contrast, clothing store sales fell by 2.6%, recovering from a previous 3.5% decrease.
Nevertheless, this latest reading represents the lowest level of clothing store sales since January 2022, influenced by various economic factors. The gradual recovery of retail sales in the UK may persist into December, as indicated by the NIQ GfK consumer confidence indicator for Britain. This measure for major purchases remains in negative territory, alongside consumers' pessimistic views on the economy.
Neil Bellamy, the Consumer Insights Director at NIQ GfK, remarked on December 13, "In a nutshell, it's the continuing uncharitable view on the UK's general economic situation that's suppressing consumer confidence.".