Business

Consumer squeeze weighs on UK retail sales

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High street shoppersImage copyright
PA

Retail sales saw only a slight pick-up in January as rising prices continued to dampen shoppers’ spending.

UK sales volumes rose by just 0.1% in January from the previous month, the Office for National Statistics said.

The ONS said the longer-term picture showed “a continued slowdown in the sector”, partly due to “a background of generally rising prices”.

Inflation has been running at a higher rate than increases in earnings, eroding consumers’ spending power.

Sales volumes in January were up 1.6% when compared with a year earlier, the ONS said. That was the highest year-on-year rate since August, but was below analysts’ expectations.

Sports equipment saw stronger sales than usual, the ONS said, as shoppers set out to meet New Year resolutions to get fit, but this was offset by falling food sales.

“Retail sales growth was broadly flat at the beginning of the New Year with the longer-term picture showing a continued slowdown in the sector. This can partly be attributed to a background of generally rising prices,” said ONS senior statistician Rhian Murphy.

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