Retail sales in Britain fall unexpectedly for second month

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Retail sales in Great Britain unexpectedly contracted for the second consecutive month in August, raising some concern for the pace of the UK’s economic recovery.

The volume of monthly retail sales in Great Britain fell 0.9 per cent between August and July, according to data from the Office for National Statistics. This was much worse than the 0.5 per cent expansion forecast by economists polled by Reuters and followed a sharp contraction in July, when many people self-isolated following contact with a Covid-19 case.

Retail sales are the first official economic data for August and the unexpected fall raises some concerns for the pace of the UK economic recovery after growth stagnated in July.

Food store sales volumes fell 1.2 per cent in August, with some evidence that the easing of hospitality restrictions had an impact on sales as people increased their social spending, eating and drinking at restaurants and bars.

Jonathan Athow, ONS deputy national statistician for economic statistics, said that data suggest that “the drop in food stores’ sales is linked to an increase in eating out following the lifting of coronavirus restrictions”.

Non-food stores reported a fall of 1 per cent, driven by contractions in department stores and other shops, such as sports equipment and computer outlets.

In contrast, automotive fuel sales volumes rose 1.5 per cent as people travelled more.

Compared with February 2020, before the first restrictions, sales were still up 4.6 per cent.

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