UK Retail Sales Report summary
August 2023
Period covered: Period covered: 02 – 29 July 2023
3 minute read
Note: This report summary is one or two months behind the current month as standard reporting practice. The content is indicative only and incomplete with certain data undisclosed. Become a member to access this data or take out a free 30 day membership trial now.
Retail sales
Retail sales rose by just xx% YoY in July according to the Retail Economics Retail Sales Index, against a xx% uplift in the previous year.
Key factors impacted headline performance in the month:
Unseasonal weather: July marked the sixth wettest since records began in 1836 and the wettest July since 2009 (Met Office), dampening footfall.
Displacement of spending: Retail, particularly non-food, is being impacted by a prioritisation of spending towards areas previously missed out on during the pandemic, including holidays abroad and events.
Record pay growth: The latest data shows that regular pay recorded the highest rate of growth since modern records began in 2001 (+7.8% YoY in Q2).
Inflation persists: Inflation remains strong at 6.8% in July, but has eased from 7.9% in June.
Rising rates: The Bank of England raised interest rates 50 basis points to 5.0% on 22 June, marking the thirteenth consecutive hike and the highest rate in 15 years. As the cost of credit and mortgages steps up, it is prolonging cost pressures for a wider set of consumers.
Weather dampens summer sales
Unseasonably wet weather dampened sales in July, marking a stark contrast to record June temperatures in the previous month and July’s heatwave last year – which included record 40-degree Celsius temperatures.
Above average rainfall saw the sixth wettest July on record and the wettest July since 2009 (Met Office). As consumers took shelter indoors, footfall dipped 0.3% between June and July, marking the first July on record that footfall has been lower than June (since 2009, Springboard).
This saw consumers shift spending online. Combined with a surge of promotional activity that supported bargain hunting and price comparisons online, the proportion of sales made online edged up to 26.1% in July from a quarter previously.
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Inflation easing but retail volumes remain in decline
Source: ONS, Retail Economics analysis
