UK Retail Sales Defy Expectations with 0.4% Rise
UK Retail Sales Defy Expectations with 0.4% Rise
On April 25, 2025, the UK’s Office for National Statistics (ONS) released data indicating a 0.4% increase in retail sales for March 2025, surpassing economists’ expectations of a 0.4% decline. This marks the third consecutive month of growth, with quarterly sales up by 1.6%, the strongest performance since July 2021.
The unexpected uptick was largely attributed to unseasonably warm and sunny weather, which encouraged consumer spending on gardening, DIY items, and fashion. Notably, textile, clothing, and shoe shops saw a 3.7% increase, while garden centres and secondhand stores experienced a 2.4% rise. Online non-store retailers also benefited, with a 1.9% increase, particularly in clothing and DIY sectors.
Despite the positive trend, food store sales declined by 1.3%, continuing a downward trajectory. Analysts caution that the figures may be influenced by factors such as Easter and school holidays falling in April.
However, the optimistic retail performance is overshadowed by emerging global economic concerns. The implementation of aggressive new tariffs by U.S. President Trump, including a 145% levy on Chinese imports, has triggered fears of disruptions to international supply chains and a potential global economic slowdown. UK consumer confidence has plummeted to its lowest point in over a year, indicating possible reductions in future household spending.
In response, the Bank of England, led by Governor Andrew Bailey, is considering an interest rate cut as it evaluates the potential economic fallout from escalating trade tensions. The International Monetary Fund has also revised the UK’s 2025 growth forecast down to 1.1% from 1.6%, citing concerns related to the trade environment.
