UK shoppers ignore Brexit uncertainty as retail sales rise in February

Unusually warm weather boosted spending, while Brexit stockpiling may have had ‘modest’ effect

Sales rose 0.4 per cent in February, compared to the previous month (PA)

Retail sales rose in February, defying evidence that Brexit-related uncertainty is causing shoppers to hold back on spending.

Sales were boosted by unusually warm weather, which prompted additional spending on goods such as garden furniture.

Sales were up 0.4 per cent on the previous month, the Office for National Statistics (ONS) said on Thursday. Excluding fuel, sales were up 0.2 per cent over the month.

Food sales fell 1.2 per cent as January promotions ended.

Over the three months to February sales were up 0.7 per cent, despite surveys suggesting that consumers were reluctant to spend.

There may have been a “modest” boost to retail sales from shoppers stockpiling goods ahead of brexit, said Howard Archer, chief economic adviser to forecasting group the EY Item Club.

“Retailers will obviously be concerned that a no-deal Brexit could yet occur on 29 March,” Mr Archer said.

“Retailers will also likely be worried that a delay to Brexit to the end of June (or late May) could fuel consumer caution and weigh down on sales.

“Markit’s UK household finance survey showed consumers’ willingness to make major purchases fell sharply this month to be at the lowest level since September 2017 and one of the lowest levels for five years.”

Separate figures showed this week that the proportion of people in work in the UK has hit a new high of 76.1 per cent while the unemployment rate is at a 44-year low.

The ONS delivered further good news for the chancellor on Thursday with data showing that public sector net borrowing was £200m in February, down from £1.2bn in the same month last year.

Government revenues rose 3.6 per cent and spending including capital investment increased 1.7 per cent. Spending was boosted by a big increase in payments to the EU.

January’s record budget surplus was revised down from £14.9bn to £13.3bn but the public finances remain on track for the smallest annual deficit in 17 years.