UK’s retail sales slump amid wet weather and cost-of-living pressures

High-street stores, bars, and restaurants lose out as Britons relax on the sofa in February.

Dampened Retail Sales

February’s retail sales faced a slowdown, with growth barely surpassing 1%, attributed to soggy weather and persistent cost-of-living pressures. 

Non-food item sales notably declined by 2.5% over the three-month period leading to February, with reduced demand for footwear, household appliances, furniture, and clothing indicating weakened consumer confidence.

Food Sales Moderation

While food sales saw a 6% increase, it marked a deceleration compared to the previous month’s 6.3% growth, influenced by easing inflation. 

Despite heightened grocery purchases, consumers remained cautious with spending due to continued challenges posed by high energy bills and borrowing costs.

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Total Retail Figures

The combination of food and non-food sales resulted in a modest 1.1% rise in total retail sales for February, marking a slowdown from previous months’ figures. 

Health and beauty, toys, and home accessories emerged as bright spots amidst the subdued retail landscape, reflecting families’ preference for home-based entertainment options.

Belt-Tightening Amidst Economic Pressures

Even higher-income households tightened their spending in response to escalating interest rates affecting mortgages, car finance, and other borrowings. 

The record rainfall in the south of England prompted increased expenditure on takeaways, fast food, and streaming services as consumers sought indoor entertainment options.

Digital Content Surges, Dining Out Declines

Digital content and subscription services experienced a notable 11.8% growth in spending, partly fueled by the release of popular series and the inclement weather. 

Conversely, spending in restaurants contracted by 13.4%, with growth in bars, pubs, and clubs reaching its lowest level since September 2022, indicating a shifting consumer preference towards home-based activities amidst economic uncertainty.