Retail Sales UK Rebound In January

UK retail sales rebounded at a faster than expected pace in January as the disruption caused by the Omicron variant faded, the Office for National Statistics said on Friday.

Retail sales volume grew 1.9 percent month-on-month, the fastest growth since April 2021 and also bigger than the expected rate of 1.0 percent.

The monthly growth followed a revised 4 percent decline in December, when earlier Christmas trading than normal in October and November, and reduced retail footfall in December, linked to concerns around the Omicron variant of coronavirus, affected sales.

Sales volumes were 3.6 percent above their pre-coronavirus February 2020 levels.

Excluding auto fuel, retail sales volume increased 1.7 percent in January after easing 3.9 percent in the previous month. Sales were forecast to climb 1.2 percent.

Non-food store sales gained 3.4 percent with strong growth in household goods stores, such as furniture stores and electrical goods stores and department stores.

Meanwhile, food store sales dropped 2.3 percent from the prior month. At the same time, automotive fuel sales were up 4.1 percent.

On a yearly basis, overall retail sales advanced 9.1 percent, reversing a 1.7 percent fall in December and faster than the economists’ forecast of +8.7 percent.

Similarly, excluding auto, sales grew 7.2 percent after falling 3.8 percent in the prior month. Sales were forecast to gain 7.9 percent.

It is encouraging that the consumer recovery was well underway in January, Adam Hoyes, an economist at Capital Economics, said. But with real wages already falling and set to decline throughout 2022, the outlook for consumer spending is hardly rosy.

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