No change in UK retail sales for September

Retail sales remained flat in September, according to figures released by the Office for National Statistics (ONS) on Thursday.

Sales volumes increased by 4.1% compared with September 2015, but were unchanged compared with August 2016. Weaker sales of food, clothing and footwear were offset by increases in department stores, household goods and non-store retailers, the ONS reported.

Over the three months to September, retail sales volumes were up 1.8% compared with the previous three months.

“The underlying trend is one of strength, suggesting consumer confidence has remained steady since June’s referendum,” said Kate Davies, a statistician at the ONS.

The figures also showed signs of prices beginning to rise, with average store prices increasing by 0.8% compared with August 2016. The largest increase was seen in textile, clothing and footwear stores.

Average store prices fell by 1.1% year-on-year, but this is the smallest decrease in just over two years.

Economists believe this could mark the start of a longer-term trend of rising prices which will affect consumer demand, after the value of the pound fell more than 15% following the vote in June to leave the European Union.

On Tuesday the ONS said that inflation rose to 1% in September.

Richard Lim, chief executive of Retail Economics, commented: “Darker clouds are forming on the horizon. As inflation accelerates more rapidly next year and the impact of a fragile jobs market transpires to weaker wage growth, disposable incomes will come under pressure.

“On the whole, consumers react to their personal experience of the economy in terms of their job security, rising prices in the shops and what happens to their wages. As of yet, not much has happened to affect spending power and so, judging by this latest data, their appetite to spend could be faltering.”