UK retail sales shrug off Brexit-fuelled inflation

AFP, LONDON: British retail sales defied rising prices caused by Brexit to surge by a faster-than-expected 1.0 per cent in August, the Office for National Statistics said yesterday.

The acceleration, up from a rise of 0.6 per cent in July, confounded analysts’ expectations for a slowdown in retail sales growth last month.

ONS Senior Statistician Kate Davies said Britain was witnessing “strong price increases across all store types compared with a year ago, reflecting wider inflationary pressures.

“However, we are still seeing underlying growth in sales volumes, and with strong growth in non-essential purchases as consumers continued to buy more from non-food stores,” she said.

British inflation has risen sharply in recent months as a Brexit-hit pound raised import costs. That, in turn, has increased the likelihood of the Bank of England raising interest rates before the end of 2017, according to analysts.

“The UK consumer continues to show remarkable resilience, with retail sales in August blowing economists’ forecasts out of the water,” said Ben Brettell, economist at stockbroker Hargreaves Lansdown.

The latest data “could bode well for economic growth—the UK economy is heavily reliant on the consumer, and economists had expected falling real incomes to eventually translate into weak retail sales,” the expert said.

While overall inflation is picking up, wage growth in Britain has stalled, offsetting recent official data showing that the UK unemployment rate has fallen to a new 42-year low at 4.3 per cent.

UK retail sales shrug off Brexit-fuelled inflation

AFP, LONDON: British retail sales defied rising prices caused by Brexit to surge by a faster-than-expected 1.0 per cent in August, the Office for National Statistics said yesterday. The acceleration, up from a rise of 0.6 per cent in July, confounded analysts expectations for a slowdown in retail sales growth last month. ONS Senior Statistician Kate Davies said Britain was witnessing strong price increases across all store types compared with a year ago, reflecting wider inflationary pressures. However, we are still seeing underlying growth in sales volumes, and with strong growth in non-essential purchases as consumers continued to buy more from non-food stores, she said. British inflation has risen sharply in recent months as a Brexit-hit pound raised import costs. That, in turn, has increased the likelihood of the Bank of England raising interest rates before the end of 2017, according to analysts. The UK consumer continues to show remarkable resilience, with retail sales in August blowing economists forecasts out of the water, said Ben Brettell, economist at stockbroker Hargreaves Lansdown. The latest data could bode well for economic growththe UK economy is heavily reliant on the consumer, and economists had expected falling real incomes to eventually translate into weak retail sales, the expert said. While overall inflation is picking up, wage growth in Britain has stalled, offsetting recent official data showing that the UK unemployment rate has fallen to a new 42-year low at 4.3 per cent.