7:00 AM, Apr 11, 2017 — UK retail sales had their biggest drop in six years in the first quarter as a pick-up in inflation after a drop in the value of the pound prompted consumers to spend more cautiously.
Comparable sales, which exclude changes in floor space, fell 0.7% last quarter from a year earlier, the biggest drop since the first quarter of 2011, the British Retail Consortium (BRC), said by e-mail on Tuesday.
In March alone comparable sales declined by 1% from a year earlier, the sharpest decline since August 2015, after a 0.4% annual drop in February, the BRC said. The March figures have been distorted by the timing of Easter, which falls in April this year while last year it fell in March, according to the BCR. Economists had forecast a 0.5% drop in March comparable sales from a year earlier, according to a poll on investing.com.
Total sales rose 0.1% last quarter from a year earlier and in March they fell an annual 0.2%, the first drop in those figures since August. Food sales on a comparable basis fell an annual 0.2% in the first quarter, while non-food sales were down 1.1% in the same period from a year earlier, the data showed.
“First impressions of March’s sales figures are underwhelming,” Helen Dickinson chief executive at the BRC said. “The pressure on prices continues to build, albeit slowly, and will inevitably put a tighter squeeze on disposable income.”
Inflation has picked up in the UK in recent months as global energy prices have climbed and the pound has depreciated since British voters backed a withdrawal from the European Union, Britain’s largest trading partner. UK consumer prices climbed 2.3% from a year earlier in March, at the same rate as in February, which was the fastest price growth since 2013, the Office for National Statistics said on Tuesday. This matched economists’ expectations in an investing.com poll.