Britain’s consumers have reined in spending after an unseasonably cold May prompted a sharp decline in summer clothing sales.
The Office for National Statistics said retail sales dropped by 0.5% in May from a month earlier, the biggest decline in spending this year, after shoppers seemingly had shrugged off Brexit fears earlier in 2019.
The second consecutive monthly fall in consumer spending will fuel concerns over the health of the British economy in the second quarter, at a time of continued uncertainty over Brexit. Although economic growth jumped by 0.5% during the first quarter amid a stockpiling rush ahead of the original Brexit deadline, economists are forecasting weaker growth ahead.
Growth in average pay has remained above inflation for the past 14 months in a row, helping households rebuild their finances after a lost decade for improvements in living standards. Average wages after inflation are still down on the pre-financial crisis peak.
The ONS said the decline in spending at department stores continued last month, reflecting the woes of high street retailers. Department stores including House of Fraser and Debenhams have struggled over the past year, with the loss of jobs and shop closures.
The government’s statisticians said that unseasonably cold weather last month had sapped demand for summer clothes, with the volume of clothing sales dropping by 4.5% from a month earlier.
Compared with May 2018, sales were up by 2.3%, the smallest annual jump in sales since October last year. Economists surveyed by Reuters had forecast growth of 2.7%.
Lisa Hooker, consumer markets leader at the accountancy firm PwC, said: “After Easter’s heatwaves, a couple of drizzly bank holidays and a nation pre-occupied by politics, things were never going to bode well for May’s retail sales.”
Fears for UK economy rise as shoppers rein in spending again – The Guardian