UK consumers keep lid on spending in October
today Nov 5, 2019
British consumers kept a tight rein on their spending ahead of December's election, despite being tempted by retailers offering heavy discounts last month, surveys showed on Tuesday.
The British Retail Consortium (BRC) said overall retail spending rose 0.6% year-on-year in October, marking the strongest growth since April when spending was boosted by the timing of Easter.
Still, the BRC said the longer-term outlook remained bleak, with the 12-month rolling average of sales growth falling to a new low of 0.1%.
"With Brexit still unresolved and a December election creating new uncertainties, retailers will be looking nervously at the months ahead," BRC chief executive Helen Dickinson said.
Consumers have propped up Britain's economy since the 2016 Brexit referendum, helping to offset reduced company investment.
But economists say recent signs of a weakening in spending by households raise the risk of a recession as the country prepares to leave the European Union.
Struggling baby products retailer Mothercare said on Monday it intended to appoint administrators for its British division - giving it temporary protection from creditors - as it battled competition from supermarkets and online retailers.
The BRC showed that in like-for-like terms, which strips out changes in retail space, sales were up 0.1% compared with October 2018.
A separate survey from payment card company Barclaycard showed consumer spending rose 1.5% in October in annual terms, slowing from growth of 1.6% in September.
"Ongoing economic uncertainty combined with a bleak start to autumn led many Brits to stay in rather than spend out last month, choosing takeaways and evenings at home over socialising at bars or restaurants," Esme Harwood, a director at Barclaycard, said.
Just 17% of consumers surveyed by Barclaycard said they had stocked up ahead of the Oct. 31 Brexit deadline, with tinned food and toilet paper the top purchases of the minority who were concerned about possible disruption from a no-deal Brexit.
© Thomson Reuters 2019 All rights reserved.