Retail sales jump 3.4% giving optimism despite recession
Non-food stores sales volumes returned to broadly expected levels, with a rise of 3.0% over the month following a 3.9% fall in December
Retail sales in the UK jumped 3.4% in January 2024 after falling 3.2% in December, according to data from the Office for National Statistics.
This is the biggest rise in retail sales since April 2021 when the UK had just emerged from the third covid lockdown.
The price of goods continued to rise, with inflation at 4% in January, but the amount spent by shoppers rose 3.9% and volumes increased 3.4%.
Food stores sales volumes rose by 3.4% over the month, recovering from December’s record fall of 3.1%.
Non-food stores sales volumes returned to broadly expected levels, with a rise of 3.0% over the month following a 3.9% fall in December.
Some of the fall in December can be put down to consumers purchasing Christmas gifts earlier, during the November Black Friday discounts.
Kris Hamer, director of insight at the British Retail Consortium, said: “There was promising news as sales volumes rose for the second time in three months, following 19 prior months of decline. This reflected rising levels of consumer confidence, as well as a boost from the January sales.
“Categories, such as computing, and cosmetic & toiletries performed well. Food sales continued to outstrip non-food sales – mainly due to higher levels of inflation on these products. Nonetheless, shoppers remained cautious as they entered the third year of the high cost of living.”
Jacqui Baker, head of retail at RSM UK and chair of ICAEW’s Retail Group, added: “A strong bounce back in retail sales last month provides a glimmer of hope for retailers following the sharp fall in December and a poor end to a tough year; but they’re not out of the woods yet. Retail spending was boosted by discounting in January and the continued demand for health and beauty products.
“January is typically a lacklustre month for the retail sector as consumers rein in spending after the Christmas period. But after a difficult Golden Quarter, the big uptick will feel like a win particularly when retailers are competing for spend as consumers look to chase away the January blues by booking holidays.”
