Increased consumer spending helps UK retail sales to shoot up in November

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Dec 17, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Mumbai) - The Office for National Statistics today reported a jump in UK’s retail sales in November, highlighting an increase in consumer spending which can be expected to prompt overall economic growth. Retail sales month on month increased 1.7 per cent in November beating estimates and higher than the -0.6 per cent decline in October and more than a 0.5 per cent increase expected. Year-on-year, it increased by 5.0% compared with November 2014, increasing for the 31st consecutive month in November 2015.

    For the three months to November, sales were 5.3 per cent up on the previous year, the biggest increase since March.

    Average store prices however fell by 3.3% in November 2015 compared with November 2014, marking the 17th consecutive month of year-on-year price falls; while the value of online sales increased by 12.7% in November 2015 compared with November 2014 and by 4.9% compared with October 2015. The amount spent in the retail industry increased by 1.4% in November 2015 compared with November 2014.

    Promotions in late November before the 'Black Friday' led to the increased retail sales last month. Both electrical and mobile phone retailer Dixons Carphone as well as online retailer Amazon reported record sales around Black Friday.

    Black Friday discounts are new in UK. Earlier such discounts would span over weeks in November and December causing sales to spread over a longer duration of time. Recently, the trend was noted to have changed. Discounts leading up to Black Friday now restrict sales to a limited number of days.

    The data wants again goes on to establish that Britain's strong economic recovery is consumer driven. Consumer demand has recorded an upward trend supported by lower inflation and rising wages and employment.

    The retail sales figures have shown wide variation making it difficult for analysts to judge the actual movement. Retail sales have recorded healthy figures only when on occasions of summer public holiday, Cyber Monday and Black Friday. The performance cannot be judged by considering one-off incidents.
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