Retail spending in the UK bounced back last month as better weather and falling inflation boosted consumer confidence.
Data from the Office for National Statistics (ONS) shows retail sales volumes rose by 2.9% in May on a monthly basis, after a weather-affected drop of 1.8% in April. Over the year to May, volumes rose by 1.3% but were still 0.5% below their pre-pandemic level in February 2020.
Food sales rose only 1.2%. However, non-food retailers had a better month (+3.5%), with marked increases in the clothing, footwear, furniture and sports goods sectors. These retailers reported improved footfall amid drier weather and the impact of promotions.
Meanwhile, online sales rose by 5.9% – the largest monthly increase and index level since April 2022.
Rob Wood, the chief UK economist at Pantheon Macro, commented: “Retail sales rebounded strongly from April’s rain-sodden disaster and will keep gaining ground as consumers’ real wage growth drives higher spending.
“The incessant rainfall didn’t stop in May, but precipitation was “only” 20% above average, compared to 68% above in April. May was also the warmest since at least 1884.”
Andrew Wishart, a senior UK economist at Capital Economics, noted that the fact that online sales were up by 5.9% on the month suggested there was more to the May increase than simply better weather attracting shoppers back to high streets.
“Overall, the retail sales data for May showed tentative signs that strengthening real income growth now inflation is back at target is feeding through to stronger spending,” he said.
