# UK retail sales jump unexpectedly, but big picture bleak Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-05-20 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: UK Retail Sales Surge Amid Bleak Consumer Confidence Trend Meta Description: Boost in alcohol and tobacco sales drives monthly rise; amid record low consumer confidence and rising living costs URL: https://financedigest.com/uk-retail-sales-jump-unexpectedly-but-big-picture-bleak-2html ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2022-05-20t081148z1lynxnpei4j08xrtroptp4britain-economy-1-1736815696109-compressed.jpg) By Andy Bruce LONDON (Reuters) – British retail sales jumped unexpectedly in April as shoppers loaded up on alcohol and tobacco, likely a blip in an otherwise bleak trend that has driven consumer confidence to all-time lows amid a worsening cost-of-living crunch. Retail sales volumes rose 1.4% month on month after a 1.2% drop in March, the Office for National Statistics said. Economists polled by Reuters had [expected a 0.2% monthly fall](https://www.financedigest.com/uk-manufacturers-expect-output-to-fall-3-2-in-2023.html "UK manufacturers expect output to fall 3.2% in 2023"). The wider picture remains disconcerting. Retail [sales in the three months](https://www.financedigest.com/uk-new-car-sales-rise-17-in-march-best-ever-month-for-evs.html "UK new car sales rise 17% in March; best ever month for EVs") to April fell 0.3%, after a 0.7% drop in March. Compared with a year ago, [sales volumes were 4.9% lower](https://www.financedigest.com/germany-to-lower-sales-tax-on-gas-to-7-in-bid-to-relieve-consumers.html "Germany to lower sales tax on gas to 7% in bid to relieve consumers"), marking the biggest annual drop since January 2021. Earlier on Friday, Britain’s longest-running gauge of [consumer confidence](https://www.financedigest.com/weary-wall-street-cheers-improved-consumer-confidence.html "Weary Wall Street cheers improved consumer confidence"), the GfK survey, fell to its lowest since records began in 1974. (Graphic: UK consumer confidence [falls to lowest since records](https://www.financedigest.com/biggest-uk-house-price-fall-recorded-since-financial-crisis.html "Biggest UK house price fall recorded since financial crisis") began in 1974, https://fingfx.thomsonreuters.com/gfx/polling/zdvxowrllpx/Pasted%20image%201653038809537.png) British consumers were hit last month by a double whammy of surging household energy costs and higher taxes, and [data published this week showed inflation](https://www.financedigest.com/oil-jumps-on-lower-than-expected-us-inflation-data.html "Oil jumps on lower-than-expected US inflation data") hit a 40-year high of 9.0%. The [Bank of England thinks inflation](https://www.financedigest.com/be-really-really-careful-on-inflation-bank-of-englands-haskel.html "Be ‘really, really careful’ on inflation – Bank of England’s Haskel") will climb above 10% later this year. So far, the conflicting signals coming from the data are consistent with our call that the UK will [stagnate in Q2,” said economists from Berenberg Bank](https://www.financedigest.com/bank-funding-for-renewables-stagnates-vs-oil-and-gas-report.html "Bank funding for renewables stagnates vs oil and gas – report"). [Sterling was little changed against the dollar](https://www.financedigest.com/sterling-steadies-vs-dollar-ahead-of-boe-ecb-meetings.html "Sterling steadies vs dollar ahead of BoE, ECB meetings") after the data. The ONS said food store sales rose by 2.9% in April, largely driven by [strong sales](https://www.financedigest.com/indias-tata-motors-jumps-to-a-7-month-high-on-strong-q4-jlr-sales.html "India’s Tata Motors jumps to a 7-month high on strong Q4 JLR sales") of alcohol, tobacco and ‘sweet treats. This was “possibly due to people staying in more to [save money,”](https://www.financedigest.com/how-to-save-money-for-a-car.html "How to save money for a car") ONS statistician Heather Bovill said. Online clothes [sales also did well as people](https://www.financedigest.com/sodexo-tops-q1-sales-estimates-as-people-return-to-offices.html "Sodexo tops Q1 sales estimates as people return to offices") got ready for summer holidays and weddings, she added. Leading supermarket groups including Tesco and Sainsbury’s have [warned of lower profits](https://www.financedigest.com/bootmaker-dr-martens-warns-on-profit-as-finance-chief-walks.html "Bootmaker Dr Martens warns on profit as finance chief walks") this year and Premier Foods, the maker of Mr Kipling cakes and OXO stock cubes, said it would raise prices of its products. Overall (the data) will still leave the BoE in the same bind, behind the curve on inflation, but fretting over a potentially sharp slowdown, above all in consumer spending,” said Marc Ostwald, chief economist at brokerage ADM [Investor Services](https://www.financedigest.com/credit-agricole-and-caceis-to-buy-rbc-investor-services-europe-unit.html "Credit Agricole and CACEIS to buy RBC Investor Services’ Europe unit"). (Reporting by Andy Bruce and David Milliken; editing by William James, John Stonestreet and Toby Chopra) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---