U.K. retail sales declined more-than-expected in September, driven by a sharp contraction in clothing sales.
Retail sales fell 0.3 percent in September from a month ago, when it rose 0.4 percent, the Office for National Statistics said Thursday. This was the first drop in four months. Economists had forecast a 0.1 percent drop for September.
Food sales recovered in September, up 0.6 percent versus a 0.8 percent drop in August. Meanwhile, non-food sales declined 1.9 percent compared to a 1.6 percent rise in the prior month.
Clothing and footwear sales were down 7.8 percent as unseasonably warm weather made consumers delay their purchases of autumn and winter.
Sales excluding auto fuel also fell by 0.3 percent. Economists had forecast a flat growth for September after a 0.3 percent rise in August.
Maeve Johnston, a UK economist at Capital Economics, said a monthly decline in retail sales volumes can be entirely explained by temporary factors. Indeed, the recovery in consumer spending still looks robust.
During the third quarter, overall retail sales gained 0.3 percent from the previous three months, suggesting that underlying pattern continues to show growth. Nonetheless, this was the weakest growth seen in sales throughout 2014.
On a yearly basis, retail sales volume including automotive fuel grew 2.7 percent in September following a 3.7 percent rise in August. This was the 18th consecutive annual growth, the longest period of sustained expansion since May 2008. But the rate of growth was weaker than an expected 2.9 percent rise.
Excluding automotive fuel, sales growth slowed to 3.1 percent from 4.4 percent in August. Sales were forecast to grow by 3.4 percent.
It does look like consumers have reined in their spending to some degree after splashing out at a strong rate overall through the first half of the year, said IHS Global Insight's Chief UK Economist Howard Archer.
Nevertheless, there are still decent supports for consumer spending and retail sales going forward, notably high and rising employment and very low consumer price inflation, he added.
Another survey from the Confederation of British Industry today showed that order books of British manufacturers' weakened to its lowest level since July 2013.
According to the Industrial Trends Survey, the total order books fell to -6 percent in October, the lowest since July 2013, from -4 percent in September. The score was forecast to improve marginally to -3 percent.
During the three months to October, 31 percent reported an increase in total new orders and 21 percent a fall, giving a rounded balance of 9 percent.
Firms anticipate continued growth for the next three months, but there are reduced expectations for total new orders and exports growth.
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December 19, 2025 15:10 ET U.S. inflation data and interest rate decisions by major central banks were the highlights of this busy week for economics news flow. Employment data and survey results on the housing markets also gained attention in the U.S. In Europe, the European Central Bank and Bank of England announced their policy decisions and macroeconomic projections.