As the cost of living crisis hits the UK, retail sales fall.
Even though the World Cup was going on and there were Black Friday sales, British retail sales fell unexpectedly in November. This could be a sign that many households are feeling stressed as the cost of living crisis eats away at their finances.
Retail sales dropped by 0.4% in November after going up by 0.9% in October. This was a bounce-back from September, when sales were hurt by a one-time holiday for Queen Elizabeth’s funeral.
A poll of economists by Reuters had predicted a 0.3% increase from October.
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“The fact that sales didn’t go up even with the World Cup and Black Friday shopping for Christmas will be a huge letdown for retailers, especially after they went up last month,” said Lynda Petherick, retail lead at Accenture in the UK and Ireland.
The Office for National Statistics (ONS) said that part of the drop could be because the data did not include online sales that happened on “Cyber Monday” on November 28. These sales will be counted in December’s numbers.
Still, the numbers released on Friday were in line with other signs that consumers are having a hard time. The amount of money spent in stores fell to 1.5% below what it was in 2019.
Earlier, the market research company GfK said that consumer confidence in Britain had gotten a little better this month, but that it was still close to an all-time low.
The latest numbers on Britain’s economy came out a day after the Bank of England raised interest rates for the ninth time in a row and said more increases were likely.
But investors said the central bank might be about to stop raising interest rates because inflation seems to have reached its peak and the economy seems to be in a recession.
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The ONS said that retail sales in November were 5.9% lower than the same month last year. This was a slightly bigger drop than what a Reuters poll had predicted.