Global| Sep 18 2008UK Retail Sales in Surprise Rise for Second Month Running
Summary
Ironically even with the second strong month of sales increases the three-month growth rate for retail sales in the UK is plunging. Barometers and surveys of retail sales have been weak, so the rise in each of the past two months was [...]
Ironically even with the second strong month of sales increases the three-month growth rate for retail sales in the UK is plunging. Barometers and surveys of retail sales have been weak, so the rise in each of the past two months was a surprise. Even so the three-month growth rate for sales is getting increasingly weaker (see chart). That points out how uneven the slowing in sales has been. In both August and July sales rose by 0.8%. But that compares to a drop in sales of 3.7% in June and that drop is dominating the three-month change. It now appears as if weakness was front loaded and probably exaggerated in June.
Still the trend for sales is lower. In the quarter to date nominal retail sales are rising at a crawl. Real sales, however, are falling at a -0.2% annual rate in Q3 even with the last two-month rise in sales. There is not much doubt that the UK consumer is under pressure or that these rebounds in sales are not a new trend.
| UK Real and Nominal Retail Sales | ||||||||
|---|---|---|---|---|---|---|---|---|
| Nominal | Aug-08 | Jul-08 | Jun-08 | 3-MO | 6-MO | 12-MO | YrAGo | Quarter- 2-date |
| Retail Total | 0.8% | 0.8% | -3.7% | -7.9% | 2.6% | 4.1% | 3.5% | 0.5% |
| Food, Beverages & Tobacco | 0.1% | 0.7% | -2.4% | -6.0% | 3.9% | 5.6% | 3.9% | 2.4% |
| Clothing footwear | 3.7% | 3.3% | -8.4% | -7.2% | 5.0% | 6.1% | 3.0% | 11.6% |
| Real | ||||||||
| Retail Ex auto | 1.2% | 0.9% | -4.2% | -8.1% | 1.9% | 3.4% | 4.5% | -0.2% |
Robert Brusca
AuthorMore in Author Profile »Robert A. Brusca is Chief Economist of Fact and Opinion Economics, a consulting firm he founded in Manhattan. He has been an economist on Wall Street for over 25 years. He has visited central banking and large institutional clients in over 30 countries in his career as an economist. Mr. Brusca was a Divisional Research Chief at the Federal Reserve Bank of NY (Chief of the International Financial markets Division), a Fed Watcher at Irving Trust and Chief Economist at Nikko Securities International. He is widely quoted and appears in various media. Mr. Brusca holds an MA and Ph.D. in economics from Michigan State University and a BA in Economics from the University of Michigan. His research pursues his strong interests in non aligned policy economics as well as international economics. FAO Economics’ research targets investors to assist them in making better investment decisions in stocks, bonds and in a variety of international assets. The company does not manage money and has no conflicts in giving economic advice.
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