// Retail sales rose by more than expected and returned to pre-pandemic levels last month
// ONS director of economic statistics Darren Morgan said that although sales “grew sharply” last month, the broader picture “remains more subdued”
Last month UK retail sales rose by more than expected, returning to pre-pandemic levels as consumer confidence rises to its highest level in a year.
The Office for National Statistics (ONS) reported a 1.2% rise in sales volumes in February compared to the previous month, despite inflation leaping to 10.4% amid rising food and drink prices.
The figure was way ahead of economists’ expectations of only a slight uptick (0.2%) amid the ongoing cost of living crisis, indicating British consumers are weathering the storm.
The ONS also revised sharply upwards, to 0.9%, the 0.5% volume growth it had originally recorded for January after the tough Christmas for the high street.
Subscribe to Retail Gazette for free
Sign up here to get the latest news straight into your inbox each morning
ONS director of economic statistics, Darren Morgan, said: “Retail grew sharply in February with sales returning to their pre-pandemic level.
“However, the broader picture remains more subdued, with retail sales showing little real growth, particularly over the last eighteen months with price rises hitting consumer spending power.
“In the latest month, discount department stores performed strongly with food shops also doing well as consumers, confronted with cost-of-living pressures, cut back on eating out or purchasing takeaways.”
PWC Industry Leader for Consumer Markets Lisa Hooker added: “Overall, retail spending appears to be more resilient than many expected at the start of the year. While consumers face cost-of-living challenges and interest rate rises, this has been offset to some extent by wage rises and caps on energy prices.
“If, as expected, inflation continues to abate, retailers will be hoping the current sales momentum picks up pace as the year progresses, possibly even in time for May’s Coronation, but certainly towards the end of the year when we expect disposable incomes to start increasing in real terms.”
Click here to sign up to Retail Gazette‘s free daily email newsletter
