Retail Sales Slip in November Amid Consumer Caution Ahead of Christmas
November retail sales volumes fell 0.1% month-on-month after seasonal adjustment, below economists' expectations of a 0.4% rise. Excluding fuel, the decline was even larger. While three-month growth remains positive, it is supported mainly by clothing and tech sectors. November Black Friday discounts failed to boost headline sales as much as in previous years after adjusting for seasonality.
The ONS household survey revealed a mixed consumer outlook: some plan to shop more on Black Friday than last year, but nearly twice as many intend to shop less. The GfK consumer confidence index rose to its joint-highest level this year but remains overall negative.
Data arrives ahead of the 26 November budget, with expectations focused on income tax changes and public finances. The Bank of England recently cut the policy rate to 3.75% after inflation dropped to 3.2% from 3.6%, aiming to support spending power as wage growth outpaces price increases.
Consumption accounts for around 60% of the UK economy, but GDP indicators reflect recession risks, showing two consecutive monthly contractions, alongside rising unemployment.
