Wet weather hits retail sales in April

24th May 2024 07:00

(Sharecast News) - Retail sales fell sharply in April, official data showed on Friday, compounding a revised fall a month earlier.

According to the Office for National Statistics, retail sales volumes fell by 2.3% last month, following a 0.2% decline in March. That was revised down from its previous estimate of 0.0%.

Analysts had been expecting a far smaller decline, of around 0.5%.

The ONS attributed the slide to the poor weather, as heavy, persistent rain kept shoppers at home. It said volumes had fallen across most sectors, with clothing, sports equipment, games and toys and furniture stores doing badly.

In total, non-food store sales volumes fell by 4.1%.

In the three months to April, overall sales rose by 0.7% compared to the previous three months, following a weak December 2023.

In the year to April, however, sales were down 2.7%, and remain 3.8% below pre-pandemic levels.

The data bucks more upbeat economic data released recently, including an uptick in consumer confidence, inflation returning to 2.3% and the UK leaving recession following faster-than-expected growth of 0.6%.

Danni Hewson, head of financial analysis at AJ Bell, said: "There was nothing charming about the rainfall that soaked our high streets in April.

"It didn't help that Easter came early. But even then, March's flatlining sales were revised down. Consumers are still looking for ways to keep a tight hold on their stretched finances; if they don't need to spend, they probably won't."

"With a summer of sport heading our way, the retail sector will be hoping for long, dry days filled with BBQs, weddings and people moving house, all reasons to splurge."

Peter Arnold, UK chief economist at EY, said: "Even by the standards of retail sales data, which is an exceptionally volatile series, recent outturns have been particularly choppy.

"The EY Item Club thinks May should see a strong rebound, mirroring the experience of December and January.

"However, taking a broader sweep, it's clear that the retail sector is still struggling to generate much momentum. And coming on the back of yesterday's softer composite PMI, it suggests that the UK is likely to see a weaker outturn for GDP growth in the second quarter, after the first quarter's very strong performance.

"Still, we remain cautiously optimistic about the consumer outlook for the second half."