London: British retail sales unexpectedly fell in January from the previous month, as rising food and fuel prices weighed on consumer spending, official data showed on Friday.
Sales by volume slid 0.3 per cent in January after a revised 2.1-per cent fall in December, the Office for National Statistics (ONS) said in a statement.
Analysts’ consensus forecast had been for growth of 1.0 per cent in January.
Over the year, retail sales expanded by just 1.5 per cent in January, experiencing the weakest growth since November 2013.
“We have seen falls in month-on-month seasonally adjusted retail sales, both in conventional stores and online, and the evidence suggests that increased prices in fuel and food are significant factors in this slowdown,” said ONS senior statistician Kate Davies.
IHS Global Insight economist Howard Archer added the data suggested that a Brexit-fuelled economic slowdown was starting to appear.
“The economy’s persistent resilience since last June’s Brexit vote has been largely built on consumers keeping on spending,” he said.
“If consumers really are now beginning to moderate their spending, the long-anticipated slowdown in the economy may be about to materialise,” Archer said.
“Consumer fundamentals remained largely healthy until recently, but purchasing power is now being meaningfully squeezed by markedly rising inflation, he continued.
“This was reinforced by a dip in earnings growth in December.”
The ONS had revealed on Wednesday that average earnings rose 2.6 per cent in the year to December, down 0.2 percentage points on the previous month.
Separate data showed earlier this week that British 12-month inflation stood at 1.8 per cent in January, up from 1.6 per cent in December.
