UK retail spending slows in October 2023

Retail trouble – UK sales hit lowest level since 2021 lockdowns

Shoppers bought less food and fuel in October 2023 as they were hit by rising living costs and poor weather, according to ONS data.

The volume of products sold last month fell by 0.3% to the lowest level since February 2021 when large parts of the UK were in Covid lockdowns. Retail sales had been expected to grow in October 2023.

The Office for National Statistics (ONS) said fuel purchases may have been ‘affected by increasing prices’.

Demand for other goods was also lower, the ONS reported.

The CNBC/NRF Retail Monitor, which tracks card transactions, also reported a drop in consumer spending in October 2023, with retail sales, excluding autos and petrol/diesel, falling by 0.08%, and core retail, which also removes restaurants, declining by 0.03%. 

The report suggested that the consumer took a spending break ahead of the holiday season, amid rising inflation, supply chain disruptions, and labour shortages.

UK inflation presented a bigger drop in October 2023 than expected – this will likely drive higher retail spending through the holiday period.

Higher pay and lower inflation will provide a lift through the Christmas 2023 holidays.

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