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UK CommentUK retail sales even weaker than expected in March

  1. Annual retail sales growth down to 1.1% in March
  2. Sales affected by bad weather, but underlying trend also deteriorating
  3. Sentiment suggests little momentum ahead
Annual retail sales growth down to 1.1 % in March
UK retail sales growth was weaker than expected in March. Total sales fell by 1.2 percent after growing 0.8 percent in February. The consensus expectation was -0.6 percent. Retail sales excluding auto fuel fell by 0.5 percent in March after growing 0.4 percent in February (revised from 0.6 percent). The annual growth rate in both total sales and retail sales excluding auto fuel fell to 1.1 percent in March. Retail sales were weighed down by a large fall in petrol sales, which, according to the ONS, was likely a consequence of the impact of bad weather on travel. Department stores was the only sector to show positive growth, with sales buoyed by online offers for Mothering Sunday and Easter.
Sentiment suggests little momentum ahead
It seems that some of the weakness in retail sales in Q1 was weather-related. However, the trend in retail sales growth has been deteriorating for around a year, with annual growth rates currently just above 1 percent. Based on past form, consumer sentiment and sector sentiment are at levels suggesting somewhat higher sales growth than that seen over recent months. However, the sideways movement in sentiment since the autumn also suggests there is currently little momentum in the sector.


 


 


Disclaimer

Kari Due-Andresen

Chief Economist Norway

Norway and UK

kadu01@handelsbanken.no

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