UK retail sales rise above pre-Covid levels as lockdown eases | Business

UK retail sales rise above pre-Covid levels as lockdown eases | Business

Retail sales rose above pre-pandemic levels in July, the first full month non-essential shops were allowed to reopen, officials figures showed.

Indicating an increased appetite since the easing of the lockdown in May to travel to work and shop on the high street, sales increased to higher levels than in February.

The value of sales increased by 4.4% and volume sales by 3.6% compared with June despite a fall in the sale of food that the Office for National Statistics said could be attributed to shoppers switching from buying dinners at the supermarket to purchasing restaurant meals.

Internet shopping also suffered a slight monthly dip, in response to many high street shops opening for the first time in July, but sales online remained more than 50% higher than in February and helped push overall retail sales above pre-pandemic levels for the first time.

Household goods stores and other non-food stores experienced the sharpest recovery, increasing sales by 6% and 2.2% respectively above their February 2020 levels.

The ONS said: “Retailers told us that DIY products sold well as people carried out home improvements during lockdown.”

When compared with February 2020’s pre-pandemic level, total retail sales were 1.7% and 3% higher in value and volume terms respectively.

However, sales in the three months to July remained below the same period last year, with a fall of 5.3% for value sales and a fall of 4.1% for volume sales.

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Howard Archer, the chief economic adviser to the EY Item Club, said: Retail sales clearly benefited in July from a full month of non-essential retailers being allowed to open. Retail sales were also likely helped in July by the opening up of pubs, restaurants and hairdressers pushing up footfall.

“However, the opening up of the hospitality sector and other consumer service sectors may have diverted some consumer spending away from retail sales towards services.”

Retail sales, which account for 5.4% of GDP, have rebounded more robustly than many other parts of the economy, though mostly through online sales.

Earlier this month, official figures confirmed that the economy was in recession after a slump in GDP of 20.4% in the second quarter that followed a 2.2% fall in the first.

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