UK retail sales fell last month as cold weather discouraged consumers from purchasing summer season items and gardening supplies, in spite of strain easing on families amid a slowdown of inflation.
UK Retail Sales Dip in June Amid Cost of Living Concerns and Weather Challenges
According to the British Retail Consortium’s most recent data, overall UK retail sales decreased by 0.2% compared to June of last year.
As residents grapple with the cost of living crisis, the trade association attributed the decline to freezing cold weather, highlighting the pressure on retailers in the context of a broader sales slowdown.
BRC’s chief executive, Helen Dickinson, stated: “retail sales performed poorly in June as the cooler weather during the first half of the month dulled consumer spending.”
“Sales of weather-sensitive categories such as clothing and footwear, as well as DIY and gardening were hit particularly hard, especially compared to the surge in spending during last June’s heatwave.”
Interest Rates and Weather Hit Spending
The bleak consumer outlook is due to the ongoing impact of high Bank of England interest rates on household spending power.
Prices are still much higher than they were prior to the cost-of-living crisis, even though inflation has returned to the government's target of 2%.
Barclays data also revealed that card spending decreased by 0.6% in June, the first drop since February 2021, as cold weather dampened consumer demand and caused some fashion brands to change their sales schedules.
Nevertheless, it noted that entertainment remained a staple for Britons, with significant increases in spending on pub visits, takeaways, and online streaming platforms.
Experts claimed that the year-over-year comparison with June 2023, when sales had been exceptionally strong, could help to explain part of the weakness in sales. Sarah Bradbury, the chief executive of the data provider IGD, stated that the heatwave experienced during the last week of June this year encouraged spending growth.
“While consumer confidence did not suffer during the June election campaign, we may anticipate a rebound after the results. The three previous general elections saw a spike in consumer confidence, so we should anticipate a similar increase as July progresses,” she continued.
The BRC said it expected retail sales to rebound in the coming months, boosted by the Men’s Euro 2024 tournament.
“Electronics sales had a better month as football fans cheering on their national teams upgraded their home entertainment systems and people replaced their pandemic purchases,” she included. “Retailers remain hopeful that as the summer social season gets into full swing and the weather improves, sales will follow suit.”