UK Retail Sales drop unexpectedly 1.4% MoM in May vs. 1.6% expected, GBP/USD tests lows
|- The UK Retail Sales came in at -1.4% MoM in May, a positive surprise.
- Core Retail Sales for the UK dropped by 2.1% MoM in May.
- The cable flirts with daily lows on downbeat UK Retail Sales.
The UK retail sales came in at -1.4% over the month in May vs. 1.6% expected and 9.2% previous. The core retail sales, stripping the auto motor fuel sales, stood at -2.1% MoM vs 1.5% expected and 9.1% previous.
On an annualized basis, the UK retail sales rose by 24.6% in May versus 29.0% expected and 42.4% prior while the core retail sales increased by 21.7% in the reported month versus 27.3% expectations and 37.7% previous.
Main points (via ONS)
“The largest contribution to the monthly decline in May 2021 came from food stores where sales volumes fell by 5.7%; anecdotal evidence suggests the easing of hospitality restrictions had had an impact on sales as people returned to eating and drinking at locations such as restaurants and bars.”
“Non-food stores reported a 2.3% increase in monthly sales volumes in May 2021 with household goods stores (for example, hardware and furniture stores) and “other” non-food stores reporting the largest growth of 9.0% and 7.7% respectively.”
“The large increase in sales volumes in April, followed by a relatively small fall in May, has resulted in the volume of sales for the three months to May 2021 being 8.3% higher than in the previous three months; there was strong growth in automotive fuel sales and non-food retailers of 19.3% and 17.8% respectively.”
FX implications
GBP/USD held the lower ground on downbeat UK Retail Sales, flirting with six-week lows of 1.3895, as of writing.
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