Published on 17 - June - 2011
ONS: sales fall sharply in MayRetail sales volumes fell 1.4% in May compared with the previous month, according to the latest report from the Office of National Statistics.
The decline comes after a 1.1% increase in April, boosted by the Royal Wedding, extra Bank Holiday and the warm weather. Last month, however, consumer caution returned amidst uncertainty over job prospects and increasing fuel prices.
Year-on-year, sales volumes increased by just 0.2%, while value went up 3.8%. This growth was driven by non-store retailing, said the ONS, with internet sales now accounting for 9.4% of all retail sales, up from 8.5% in April 2011. Non-store retail volumes went up 19% year-on-year.
Non-food stores saw volume growth across all sectors apart from household goods, which fell by 6% year-on-year, the fourth consecutive month of decline. The sector also saw sales value decrease by 5.5% over the period.
The prices of goods sold within these stores increased by an estimated 1.3%.
British Chambers of Commerce chief economist David Kern commented: "The May figures were disappointing and much weaker than expected by most analysts. Although some decline was expected after the strong April figures, in part due to special factors such as the Royal Wedding, the very large decline in May highlights the major challenges facing the British economy in the months ahead.
"In the face of high inflation and weak wage growth, it is clear that consumers are retrenching. On the basis of these figures we reiterate our forecast that GDP is likely to grow by only 0.3% in the second quarter of 2011, much less than the OBR and other analysts are predicting."
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