UK retail sales rebound strongly in July with World Cup football sneaking in

• The UK retail sales rose 0.7% in July after falling -0.5% m/m in June while core retail sales excluding motor fuel sales rose 0.9% in July after falling -0.6% m/m in June.
• The UK retail sales in July surprised on the upside due to strong online sales.

The UK total retail sales increased 0.7% over the month in July after slumping unexpectedly by -0.5% m/m in June. Core retail sales stripping the basket off motor fuel sales increased 0.9% m/m in July after falling -0.6% m/m in June. Over the year, total retail sales accelerated to 3.5% y/y in July while core retail sales increased 3.7% y/y, the Office for National Statistics (ONS) said on Thursday.

Non-store retail sale rose strong 4.9% over the month while increasing 16.9% over the year in July. 

Spending online continued to increase to reach a new record proportion of all retailing at 18.2% in July 2018, with strong growth in department stores also reaching a record proportion at 18.2% in July. 

UK retail sales surprised on the upside due to strong online sales and sales promotions triggering shoppers increased activity as the football World Cup supported strong food and beverages sales.

“Many consumers stayed away from some high street stores in July, but online sales were very strong, supported by several retailers launching promotions. Food sales remained robust as people continued to enjoy the World Cup and the sunshine,” Rhian Murphy, a senior statistician at ONS wrote in the retail sales report.

Within the structure of the UK retail sales, all four main sectors contributed positively to the growth in both quantity bought and amount spent in July.

The main contribution to the amount spent came from food stores at 2.2 percentage points, whereas the main contribution to the quantity of goods bought came from non-store retailing at 1.6 percentage points.

Contributions to UK retail sales y/y growth