UK retail sales rebound way beyond expectations in April

The office for National Statistics (ONS) published the UK’s retail trade report for the month of April, which showed that the UK consumer spending staged a solid comeback across the time horizon, beating market expectations by a big margin.

The UK’s retail volumes came in at 2.3% in April m/m, while the annualized retail spending surged to 4.0%. Markets had estimated a 1.0% expansion on a monthly basis; while a 2.0% reading was expected on yearly basis.

Retail sales excluding volatile items such as fuel also bounced and bettered expectations, arriving at 2.0% m/m and 4.5% y/y.

Main points

In April 2017, the quantity bought in the retail industry increased by 2.3% compared with March 2017 and by 4.0% compared with April 2016.

The underlying pattern, as measured by the 3 month on 3 month estimate, showed a slight increase in April 2017 following a short period of contraction, increasing by 0.3%.

Anecdotal evidence from retailers suggests that good weather contributed to growth.

Average prices slowed slightly in April 2017, falling from 3.3% in March to 3.1% in April.