Consumer Spending: the lowest since records began

CONSUMER SPENDING LEFT LANGUISHING: British Retail Consortium (BRC)

Covering the four weeks 30 June – 27 July 2019

  • On a total basis, sales increased by 0.3% in July, against an increase of 1.6% in July 2018. This is the lowest figure recorded for the month of July since BRC records began in 1995 and comes after the worst June on records. This is above the 3-month average of -1.3% but below the 12-month average of 0.5%. This is the lowest 12-month average on records.
  • UK retail sales increased by 0.1% on a like-for-like basis from July 2018, when they had increased 0.5% from the preceding year. This is above the 3-month and 12-month averages of -1.5% and -0.2% respectively.
  • Over the three months to July, in-store sales of Non-Food items declined 4.1% on a Total basis and 4.0% on a like-for-like basis. This is worse than the 12-month Total average decline of 2.6%.
  • Over the three months to July, Food sales decreased 1.0% on a Like-for-like basis and 0.3% on a Total basis. This is below the 12-month Total average growth of 1.8% and the lowest 3-month average since December 2014, excluding Easter distortions.
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Inflation rate down

Consumer price inflation, UK: January 2019 – ONS

  • The Consumer Prices Index including owner occupiers’ housing costs 12-month inflation rate was 1.8% in January 2019, down from 2.0% in December 2018.
  • The largest downward contribution to the change in the 12-month rate came from electricity, gas and other fuels, with prices overall falling between December 2018 and January 2019 compared with price rises the same time a year ago.
  • These downward effects were partially offset by air fares, with prices falling between December 2018 and January 2019 by less than a year ago.
  • The Consumer Prices Index (CPI) 12-month rate was 1.8% in January 2019, down from 2.1% in December 2018.

Growth lowest for six years

GDP monthly estimate, UK: December 2018

Headline annual gross domestic product (GDP) growth was 1.4% in 2018, the lowest it has been in six years. Meanwhile, the services sector had annual growth of 1.7%, the lowest since 2011 and the production sector had annual growth of 0.7%, the lowest since 2013. Construction annual growth was 0.6%, the lowest since 2012. Construction growth contracted in Quarter 4 2018, the first negative three-month growth since May 2018

UK gross domestic product grew by 0.2% in Quarter 4 2018

Rolling three-month growth slowed further to 0.2%, after growth of 0.3% in November 2018

GDP fell by 0.4% in December 2018

CPIH down in December

Consumer price inflation, UK: December 2018

  • The Consumer Prices Index including owner occupiers’ housing costs (CPIH) 12-month inflation rate was 2.0% in December 2018, down from 2.2% in November 2018.
  • The Consumer Prices Index (CPI) 12-month rate was 2.1% in December 2018, down from 2.3% in November 2018.

Inflation up to 2.5%

Consumer price inflation, UK: July 2018 – ONS

The Consumer Prices Index (CPI) 12-month rate was 2.5% in July 2018, up from 2.4% in June 2018.

  • The Consumer Prices Index including owner occupiers’ housing costs (CPIH) 12-month inflation rate was 2.3% in July 2018, unchanged from June 2018.
  • Rising prices for computer games and transport fares produced the largest upward contributions to change in the 12-month rate between June and July 2018, although computer game prices tend to be highly variable from month to month.
  • The upward effects were offset by falls in prices for clothing and footwear, and the removal of initial charges for investment in some unit trusts.
  • Prices for clothing and footwear fell by 0.4% between July 2017 and July 2018, the first time the 12-month rate has been negative since October 2016.

Inflation falls

Consumer price inflation, UK: February 2018: ONS

  • The Consumer Prices Index (CPI) 12-month rate was 2.7% in February 2018, down from 3.0% in January 2018.
  • The Consumer Prices Index including owner occupiers’ housing costs (CPIH) 12-month inflation rate was 2.5% in February 2018, down from 2.7% in January 2018.
  • The largest downward contributions to the change in the rate came from transport and food prices, which rose by less than a year ago.
  • Falling prices for accommodation services also had a downward effect.
  • Rising prices for footwear produced the largest, partially offsetting, upward contribution.

Unemployment rises

UK labour market: February 2018 – ONS

Main points for October to December 2017

  • There were 1.47 million unemployed people (people not in work but seeking and available to work), 46,000 more than for July to September 2017 but 123,000 fewer than for a year earlier.
  • The unemployment rate (the proportion of those in work plus those unemployed, that were unemployed) was 4.4%, down from 4.8% for a year earlier.
  • There were 8.77 million people aged from 16 to 64 who were economically inactive (not working and not seeking or available to work), 109,000 fewer than for July to September 2017 and 95,000 fewer than for a year earlier.
  • The inactivity rate (the proportion of people aged from 16 to 64 who were economically inactive) was 21.3%, lower than for a year earlier (21.6%).
  • There were 32.15 million people in work, 88,000 more than for July to September 2017 and 321,000 more than for a year earlier.
  • The employment rate (the proportion of people aged from 16 to 64 who were in work) was 75.2%, higher than for a year earlier (74.6%).
  • There were 901,000 people (not seasonally adjusted) in employment on “zero-hours contracts” in their main job, little changed compared with a year earlier.