UK Retail Sales Fall 0.4%, Consumers Begin to Hold Back Spending Ahead of Energy Shock
UK retail sales fell for the first time in three months in February, indicating consumers were beginning to hold back spending even before the Iran war worsened the UK economic outlook. The ONS reported that total goods sales volumes—both online and in stores—fell 0.4%, reversing the previous month's revised 2% jump. This decline was milder than economists' forecasts of -0.7%, but still marked an early weakening into a period of uncertainty.
This data comes as energy risks are expected to increase inflationary pressures and weigh on consumption. Economists have lowered growth forecasts amid Middle East conflicts, while the Bank of England believes the petrol price shock will quickly filter through to UK inflation. Households also face potential increases in electricity and gas bills during the summer energy price cap adjustment.
A GfK survey released Friday showed that households are likely to increase savings and delay large-value purchases to cushion the impact of the energy shock. Separately, the British Retail Consortium said inflation concerns pushed sentiment to its lowest level in March since the Labour government under Prime Minister Keir Starmer.
Source: Newsmaker.id
