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UK suffers surprisingly sharp fall in retail sales
Business digest: sales drop in May as consumers react badly to economic uncertainty
After an April of warm weather and bank holidays, the UK suffered a sharp fall in retail sales figures, it has been revealed today. The slump was far larger than many economists predicted, with sales volumes dropping 1.6 per cent in May, wiping out an April rise of 1.2 per cent.
Explaining the drop, the Office for National Statistics said: "Feedback from retailers suggests that the downturn is a result of consumers cutting back due to the economic climate, for example increasing fuel prices and uncertainty over job prospects and pay."
The May figures mean that, quarter on quarter, sales have fallen in six of the past seven months. The rise in VAT implemented earlier this year - combined with high inflation, low wage growth and uncertainty on public sector cuts - is believed to have affected consumer behaviour.
Read a full story in the Financial Times (registration). ·
