Retail sales fell 0.8% in September as shoppers cut back on spending after a bumper summer. Food sales suffered their biggest monthly drop in three years.
The monthly data is notoriously volatile, but the year-on-year figure of 3.0% undershot economists’ forecasts of a 3.6% rise, and September’s drop dragged the three-month number down to 1.2%, the third fall in a row.
It looks like consumer spending – along with the weather – peaked in early summer and has been declining ever since.
Where we go from here is highly uncertain. Brexit is hitting consumer confidence hard, but on the plus side wage growth has hit a decade high while inflation is falling. So consumers look likely to have more spending power – the issue is whether they choose to use it, or keep their powder dry until more clarity over Brexit emerges.