Retailers sales levels unexpectedly fell in October

Retailers sales levels unexpectedly fell in October which was the lowest since February 2021, the Office for National Statistics (ONS) said.

The ONS said that retail sales dropped 0.3% int eh month and they revised September’s drop from 0.9% to 1.1%.

A consensus estimate supplied by Pantheon Macroeconomics analysts said that in October they expected a rise of 0.4%.

Food sales fell 0.3% in October which was far worse than in September, and in the month non-food stores had a decline of 0.2% and in September sales fell 2.1%.

Heather Bovill, deputy director for surveys and economic indicators at the ONS said, “Retail sales fell again in October to their lowest level since February 2021 when widespread lockdown restrictions were in place.

“After rebounding in September, fuel sales dipped with increasing prices discouraging customers, while food sales also dropped as consumers prioritised essential goods.

“It was another poor month for household goods and clothes stores with these retailers reporting that cost-of-living pressures, reduced footfall and poor weather hit them hard.

“However, it was a better month for online retailers, the only main sector to report growth in October.”

Aled Patchett, head of retail and consumer goods at Lloyds Bank, said, “Another dip in sales suggests rising household costs remain at the forefront of consumers’ minds, despite headline inflation easing in recent months.

“The rising cost of living remains a drag on consumers’ discretionary incomes. Households continue to prioritise essential spending, particularly as falling winter temperatures push energy use up and high levels of inflation prevent material downturns in the prices of goods.

“Retailers will now be looking to strike the balance of getting staffing levels right while also being mindful that an early sales offering might not get the tills ringing as loudly as they’d like, as consumers navigate financial challenges elsewhere.”