Data from the Office for National Statistics this morning showed that U.K retail sales fell by more than expected in the month of September and points to weakness in the broader economy during Q3.
Retail sales were -0.8% lower than in August, and were just +1.2% higher than a year earlier. The consensus had expected monthly sales volumes to remain flat.
The decline was driven largely by a fall in sales of non-essential items, such as spectacles, souvenirs, weapons and collectables.
The weak performance means retail sales will contribute just +0.03% to third-quarter economic growth, roughly a third the contribution in the second quarter, the ONS says.
Today’s figures would suggest that the British consumer might be retrenching amid meager wage growth and high inflation.
Sterling (£1.3156) has dropped to a one-week low outright and against the EUR (€0.8980).
