Food sales drop as barbecue summer ends

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Food sales saw their steepest drop in three years in September as consumers tightened their belts after the unusually hot summer, the Office for National Statistics (ONS) has said.

Sales of food were down 1.5% in the month, contributing to a 0.8% fall in total UK retail sales.

The ONS said sales continued to grow in the quarter to September, boosted by online shopping and sales of jewellery.

But it said the slowdown in food sales had been “stark”.

It follows the joint hottest summer on record – also boosted by the World Cup in June and July – which saw consumers splash out on food, drink and barbecues.

However, recent surveys from both the British Retail Consortium and Barclaycard indicated that households began to rein in their spending as temperatures cooled in September.

The ONS said falls had been spread across supermarkets and smaller stores, although other areas of retail suffered too.

Spending was down at petrol stations in September and flat at non-food stores, it said.

Annual growth in total retail sales also slowed to 3%, despite economists’ predictions of an increase – although the ONS said this still marked “strong growth”.

‘Hit from all sides’

Ian Gilmartin, from Barclays Corporate Banking, said: “Although the dip in food sales from August is eye-catching, it was expected given the exceptional performance achieved over the summer and shouldn’t cause undue concern.

“Any growth is significant given the plethora of challenges facing retailers – they are being hit from all sides, with business rates, the continued weakness of sterling and persisting uncertainty around Brexit combining to thwart investment and push up costs.”

But Ben Brettell, senior economist at Hargreaves Lansdown, was more pessimistic.

“It looks like consumer spending – along with the weather – peaked in early summer and has been declining ever since. Where we go from here is highly uncertain.”

The figures come a day after the ONS said that cheaper food prices had driven down inflation in September to 2.4% from a six-month high of 2.7% in August.

Wage growth is also at its highest level in 10 years – with unemployment at a 43-year low – suggesting the pressure on consumer spending power is easing.

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