Economic news

Reduction of consumer buying power in UK hits retailers and services sector

UK retailers had to operate in difficult circumstances in the previous month, when shoppers preferred to save money for their basic set of purchases like food and stay away from big spending.

Sales unrelated to food moved down by 1.2% over the 3 months including January, as furniture, shoe, and expensive apparel stores registered the lowest figures since 2009, data from British Retail Consortium and KPMG shows.

Some positive data for supermarkets came as well, when similar food sales rose by 2.9%, though all the additional expenditures are explained by bigger prices.

The reduction of population’s buying power negatively affected the services sector, as it showed the lowest monthly results since the referendum on Brexit, the amount of car sales was also hit, as industry figures reveal, meaning that the Britain’s economy starts the year facing hurdles.

The BOE forecasts wage growth to go higher than today’s 2.5% in the course of the year and inflation to drop from 3% it currently stands at. But at the moment UK families’ real disposable income falls due to higher inflation and little wage growth.

To leave a comment you must or Join us

More news

Back to economic news list

By visiting our website and services, you agree to the conditions of use of cookies. Learn more
I agree