Retail sales exceeded forecasts in June as sunny weather boosted spending.
The latest report from the Office for National Statistics (ONS) shows that retail sales volumes grew by 0.7% following a rise of 0.1% in May, revised down from an earlier estimate of 0.3%.
Analysts had forecast an increase of 0.2% in June.
Food stores sales volumes returned to growth, rising by 0.7%, following a fall of 0.4% in May as people ordered more takeaways and ate out during the extra bank holiday for the King’s coronation.
“Retail sales grew strongly, with food sales bouncing back from the effects of the extra bank holiday, partly helped by good weather, and department stores and furniture shops also having a strong month,” said ONS chief economist Grant Fitzner.
“However, these were partially offset by falls in fuel, garden centres and clothes shops.”
Across the quarter, retail sales volumes rose by 0.4% in the three months to June compared with the three months to March.
Helen Dickinson, chief executive of the British Retail Consortium, said that consumer confidence remains “fragile” and with household budgets under pressure from high inflation and rising interest rates, many held back on making big purchases, especially in areas such as electricals.
Separate figures from research firm GfK show that consumer confidence dropped six points in July to -30, the first fall since January.
“There are clear concerns for the coming year for our personal finances and for the wider UK economy, with these measures down six and eight points, respectively,” said Joe Staton, client strategy director at GfK. “The recent fall in headline inflation will do little to improve the financial mood; consumers need to see falling prices and interest rates before that happens.”
