High Street

February retail growth hit by ‘Brexit uncertainty’

February retail growth was hit by “Brexit uncertainty” according to the BRC as on a total basis, sales increased by 0.5% in the month, a slowdown when compared with 1.6% in February 2018.

This was found to be below both the three-month and 12-month averages of 0.9% and 1.2% respectively. UK retail sales decreased by 0.1% on a like-for-like basis from February 2018, when they had increased 0.6% from the preceding year.

Over the three months to February, in-store sales of non-food items declined 2.8% on a total basis and 3.1% on a like-for-like basis. This is below the 12-month total average decline of 2.4%.

The BRC also found that online sales of non-food products grew 5.4%, against a growth of 6.4% the previous year. This is below the three-month average of 5.6% and pulls down the 12-month average to 6.9%.

Helen Dickinson OBE, chief executive of the BRC, said: “Uncertainty surrounding the UK’s imminent exit from the European Union has hit consumer spending. While real incomes have started to rise over the past year, shoppers have been reluctant to spend this February, holding back growth. This slowdown was not limited to physical stores, with growth in online non-food sales well below the twelve month average.

“With consumers increasingly aware of the risk of a no deal Brexit, it is likely that uncertainty has driven this cautious approach to retail spending. If government wishes to reassure both the public and businesses, they should ensure a chaotic no deal – which would lead to higher costs, higher prices, and less choice for consumers – is taken off the table with immediate effect.”

Paul Martin, UK Head of Retail at KPMG, added: “Following a modest recovery in January, February saw a slowdown in sales. While consumer spending has so far remained relatively resilient, driven by factors such as low unemployment and wage growth, it would seem that continuing political and economic uncertainties are beginning to notably affect shoppers’ spending habits.”

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