Retail sales volumes in the UK fell 0.2 per cent in August on the previous month, according to figures released today.
Compared with August 2011, retail sales volumes increased by 2.7 per cent while retail spend grew by three per cent, according to the Office for National Statistics (ONS), while the Olympics brought a boost over the month in sporting goods and toy sales.
However, this is below expectations for the period and Samuel Tombs, UK Economist at Capital Economics, said: “While the Olympics appears to have created some winners and losers on the high street, August’s official figures show that the Games failed to provide an overall boost to retail spending.”
Retail sales transacted online fell to 8.1 per cent in the month from nine per cent in July, the lowest proportion in a year and this decline in online sales has also been attributed to the Games, as the ONS said: “Feedback from online retailers suggests that sales were lower as consumers watched the Olympics instead of shopping online”.
Fuel price increases reduced the amount of discretionary spend for consumers as petrol prices rose 2.5 per cent in the month, though Tombs believes that the fall in oil prices since then brings hope that the price will fall back again in the near future.
Retail sales last month were 0.6 per cent higher than three months ago and it is hoped that this improvement will boost GDP in the third quarter.
Nonetheless, fears about the state of the economy in the coming months, particularly in the run up to the crucial Christmas period, have been far from abated following today’s figures.
Tombs concluded: “With consumer confidence still very weak and inflation set to outpace earnings growth for another six months or so, we would not be surprised to see further falls in retail sales in the coming months.”