Retail sales rebound in April despite inflationary pressures

UK retailers saw sales return to growth in April as shoppers continued to spend despite continued high inflation, according to official figures.

Supermarkets were among retailers to report higher sales despite food inflation remaining close to a 45-year-high.

The Office for National Statistics revealed that retail sales volumes increased by 0.5% last month, following a fall of 1.2% in March.

Economists had only predicted an increase of 0.3% for the month.

However, the ONS added that sales volumes were down 3% on the same month last year, although shoppers spent more due to higher pricing.

ONS chief economist Grant Fitzner said: “Retail sales grew, partially rebounding from a poor weather-affected March, with jewellers, sports retailers and department stores all having a good month.

“Despite continued high food prices, supermarkets also recovered from the fall in March.

“However, these were partly offset by a drop in the amount of fuel sold, despite prices also dropping.”

Non-food retailers reported that sales grew by 1% in April, after March’s wet weather had knocked high streets.

This included strong sales in watches and jewellery, while sports equipment was also in high demand.

Meanwhile, department store sales increased by 1.7%, as they recovered from a 3% fall in the previous month.

Elsewhere, sales volumes at food stores increased by 0.7% for April.

It comes despite the ONS revealing earlier this week that food inflation has remained at high levels, with prices up 19.3% in April compared with the same month last year.

Rises for supermarkets and other high street stores were partly offset by the lower demand for fuel, with petrol stations and forecourts reporting a 2.2% decrease for the month.

Reaction

PwC leader of consumer markets Lisa Hooker

“Overall, the trajectory remains positive, with the best quarterly improvement in retail sales volumes since August 2021.

“With this month’s sales likely to be helped by the coronation and additional bank holidays, we expect the positive momentum to continue in the short term.

“However, retailers will be hoping that the current green shoots are not dampened by higher interest rates or other macroeconomic challenges over the summer.”

British Retail Consortium CEO Helen Dickinson

“Sales should improve further as we enter the summer months, especially with inflation starting to ease and consumer confidence slowly stabilising.

“Government must ensure it does not sabotage this momentum by adding cost pressures onto retailers from new policies, as these will mainly serve to push prices back up for people up and down the country.”

Deloitte head of retail Oliver Vernon-Harcourt

“April saw a surprising uplift in retail sales despite ongoing inflationary pressures. The Easter Bank Holiday weekend likely contributed to consumers spending more in department stores and on clothing and accessories. The economic environment remains incredibly tough for many, but consumer confidence is slowly improving from record lows seen in the past year.

“While headline inflation is falling and the weather is improving, food prices remain stubbornly high. This, combined with rising interest rates, suggest all but the wealthiest consumers will continue to be careful about where and how they spend. The importance of loyalty programmes, promotions and great value product will remain key to success for retailers.”