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British retail sales rose 1.2 per cent in April, significantly overshooting analysts’ expectations as warm weather encouraged consumers to spend more, particularly on food.
Economists polled by Reuters had expected the volume of goods sold to rise 0.2 per cent in the month, after a revised increase of 0.1 per cent in March.
Friday’s monthly data from the Office for National Statistics showed that sales in food stores grew 3.9 per cent, which retailers attributed to the good weather, according to the ONS.
The Met Office said that last month was the sunniest April since records began in 1910.
ONS senior statistician Hannah Finselbach said the weather had helped to boost sales across most retail sectors.
“After a poor couple of months, food sales bounced back, with supermarkets reporting robust sales, while it was also a positive month for butchers and bakers, alcohol and tobacco stores,” she said.
However, clothing sales fell in the month, despite “a brighter picture for department stores and household goods shops”.
The figures give some reassurance about the health of consumer demand, in a month that saw sharp rises in uncertainty over US trade tariffs and rising utility bills and taxes, such as UK road tax and stamp duty.
Neil Birrell, chief investment officer at Premier Miton Investors, said: “The retail sales data for April shows that the UK consumer is out and about consuming. Any concerns over energy price increases and council tax hikes don’t seem to have had an immediate impact on spending habits.”
Rob Wood, economist at the consultancy Pantheon Macroeconomics, said the rise “challenges the idea of a cautious consumer”. The gain in retail sales will add about 0.1 percentage points to April GDP growth, “which sets the stage for solid quarterly performance”, he added.
The economy grew by 0.7 per cent in the first quarter, but household consumption was a small contributor. Most economists, including those at the Bank of England, expect growth to slow in the second quarter, with the consensus of only 0.1 per cent in the three months to June.
Some consumers benefited from the increase in the national living wage last month while mortgage rates had also declined in April on expectations that the BoE would cut interest rates. As expected, the central bank lowered borrowing costs by a quarter point to 4.25 per cent earlier this month.
Sales volumes, which are adjusted for seasonality and different timings of Easter, rose 1.8 per cent in the three months to April compared with the previous quarter, the largest three-monthly growth in nearly four years, the ONS said. Sales volumes reached pre-pandemic levels, rising 0.3 per cent above the February 2020 figure, for the first time since July 2022.
Separate data from the research company GfK on Friday showed that UK consumer confidence rose 3 points to minus 20 in May, after US President Donald Trump’s tariff blitz resulted in a four-point drop in April.
Millions of British households will see lower energy bills from July after regulator Ofgem said on Friday its domestic price cap would fall 7 per cent to reflect lower wholesale energy prices.
However, inflation rising more than expected to 3.5 per cent in April and expected to last at elevated rates until September, “could cast a long shadow over spending”, warned Sagar Shah, associate partner at McKinsey & Company.
