Tue, 28 Sep 2021

UK retail sales volumes rise modestly in June: ONS

Xinhua
24 Jul 2021, 02:18 GMT+10

LONDON, July 23 (Xinhua) -- Britain's retail sales volumes rose by 0.5 percent between May and June and were up 9.5 percent when compared with their pre-pandemic February 2020 levels, the British Office for National Statistics (ONS) said Friday.

The largest contribution to the monthly increase in June came from food stores where sales volumes rose by 4.2 percent, with anecdotal evidence suggesting these increased sales may be linked with the start of the Euro 2020 football championship.

"Conversely, non-food stores reported a fall of 1.7 percent in monthly sales volumes, their first fall on the month since January 2021," said the ONS.

The volume of sales for the second quarter (Q2), referring to the three months to June, was 12.2 percent higher than in the previous three months, largely boosted by strong sales in April when non-essential retailing re-opened, according to the ONS.

James Smith, a developed markets economist at financial services firm ING, said British shoppers are rebalancing spending toward services instead of retail and the Delta variant first identified in India doesn't seem to be having much of an impact yet.

"Sales are comfortably (9.5 percent) above pre-virus levels, something that can't be said for many other consumer-facing sectors in the UK right now," said Smith.

"What we're maybe seeing is consumers (unsurprisingly) rebalancing some spending away from retail -- which is primarily goods -- towards newly reopened services," said Smith.

Suren Thiru, head of economics at the British Chambers of Commerce, said retail sales in the second quarter is expected to raise the country's Q2 economy.

"Retail set to provide a strong boost to Q2 UK GDP (gross domestic product)," said Thiru, adding that the growth of 12.2 percent for retail sales in the quarter was the "strongest outturn since last year's reopening of the economy in the three months to September 2020."

About retailing prospects in the rest months of the year, Smith said he believes it would be "solid but unexciting".

"Further gains in sales may be trickier to achieve, despite a recovery in consumer confidence and the large pool of involuntary savings," he said.

"In short, while consumer spending as a whole will help drive GDP fairly close to pre-virus levels by the end of the year, it's likely that many of the marginal gains from now on will be found in services as opposed to retail," Smith added.

England has recently lifted almost all its remaining COVID-19 restrictions despite the rising number of infections in much of the region.

About 88 percent of adults in Britain have received the first jab of COVID-19 vaccine and more than 69 percent have received two doses, according to the latest figures.

To bring life back to normal, countries such as Britain, China, Russia, the United States as well as the European Union have been racing against time to roll out coronavirus vaccines.

More Kolkata News

Access More

Sign up for Calcutta News

a daily newsletter full of things to discuss over drinks.and the great thing is that it's on the house!