Retail sales in Britain surprisingly increased by 0.4% in March
Here's the rewritten article:
Feeling the sunny skies, British retail sales unexpectedly surged 0.4% in March, preceding Donald Trump's historically steep tariffs on global trade partners in April. The data, released by the Office for National Statistics, showed an uptick in consumer spending, with clothing and outdoor stores reaping the rewards of the warmer weather.
Contrary to economists' predictions of a 0.4% contraction, retail sales volume exceeded expectations. The rise in sales was tempered somewhat by declines in supermarket sales.
The figures followed a 0.7% increase in February and a 1.4% rise in January. However, the March data doesn't account for the potential fallout from Trump's tariff bombshell, which struck in April and sent shockwaves through the business and household sectors this month.
A separate report published by GfK revealed that consumer confidence plummeted four points to -23 in April, marking the lowest level in more than a year.
Earlier in the week, the S&P Global PMI indices suggested that the US tariffs and escalating costs had already begun taking a toll on business morale.
Rob Wood, an economist at Pantheon Macroeconomics, commented, "Retail sales were cruising along quite well before President Trump's tariffs dampened consumer confidence."
Alex Kerr, an economist at Capital Economics, stated that the retail sales figure would tack on 0.1% to the first-quarter GDP. However, Kerr warned that the increase in consumer spending might not last as the drop in consumer confidence in April indicates that households may become more cautious with their spending in the coming months.
The UK's economy kicked off the year on a stronger-than-anticipated note, with a 0.5% GDP increase in February hinting at robust growth for the first quarter. The Met Office reported that the UK experienced its third-sunniest March on record, boosting sales in non-food stores, including department stores, clothing, and household goods shops.
Sales in these stores climbed 1.7% over the month, reaching their highest level since March 2022. In the three months leading up to March, sales were up 1.6% compared to the previous three months, marking the fastest growth since mid-2021.
The data, however, was collected before the US president revealed steep "reciprocal" tariffs on over 90 countries, including the UK, in early April. In addition, the cost of several utilities for UK consumers and both road and stamp duty taxes increased this month.
"We were optimistic about the prospects of UK consumers before the US's mass tariff push," said Wood. "Now the question is to what extent will rising uncertainty impact consumers' spending habits."
- In contrast to economists' predictions, retail sales volume exceeded expectations in March, with an unexpected 0.4% surge.
- The rise in retail sales was mainly observed in clothing and outdoor stores, possibly due to the warmer weather in March.
- The Reuters report points out that the industry experts' forecast of a 0.4% contraction in retail sales was not realized, with the actual growth surpassing expectations.
- The sunny skies in 2022 contributed to the sales increase in the retail sector, particularly in non-food stores such as department stores, clothing, and household goods shops.
- The installed Met Office data highlighted that March 2022 was the third-sunniest recorded March, which seems to have encouraged British consumers to boost their retail spending.
- Amid the expectations of robust growth in the first quarter of 2022, economy experts are now questioning the extent to which increasing uncertainty due to the US tariffs may impact consumers' spending habits.
