- Retail sales jumped 0.5% in July
- Department stores and sports equipment stores were the biggest contributors
- Fuel sales down despite price falls
Danni Hewson, head of financial analysis at AJ Bell, comments on the latest retail figures in the UK and what that will mean in the upcoming months. Danni’s full comment can be seen below:
“It’s still a pretty tricky time for retailers despite sales recovering somewhat in July. The summer sun finally made an appearance, and the country was in a celebratory mood as England’s male footballers made it to the Euro 2024 finals.
“Children across the country wanted to emulate their heroes in parks and at local pitches and many adult supporters just wanted the right kit when they headed to their local pubs to raise a glass whilst watching the drama unfold. Figures out earlier this week from Kantar also showed people were happy to indulge in a few glasses of wine as they enjoyed the spectacle on the Seine as the Olympics got underway.
“But sporting optimism didn’t completely obliterate cash concerns and consumers were still searching out deals before they opened their wallets. Stuff still costs more than it did a couple of years ago and even as inflation stuck at ‘normal’ levels in July, people’s disposable income isn’t stretching as far as it used to – something starkly evident when you look at the ONS graph showing the difference between volumes and values.
“Not every retailer enjoyed a mid-summer bounce back. Clothing and furniture sales were still subdued, and fuel sales were down almost 2% despite prices at the pump falling.
“There is still a degree of uncertainty hanging over the British public’s heads. Inflation is so much lower than it was, but we know fuel prices will rise this autumn and grocery prices have ticked higher this month.
“Even with interest rates expected to fall further there’s a niggling concern about what October’s Budget might mean for all our finances. We understand the importance of consumer confidence for economic growth – of people not only feeling better off but being prepared to spend.
“For retailers the coming months are important as nights draw in and thoughts turn to paying for those presents under the tree.”
