• Home
  • Blog
  • Uk Retail Sales Slump To Covid Era Levels

UK retail sales slump to Covid-era levels

GBP v USD gains 1% through the week with GBP v EUR unchanged..

 

 

Dismal UK retail sales figures for October has done little to the Pounds fine performance this week, even though the data is worrying. We believe that because of the season with Black Friday this month, Christmas & Boxing Day next month and January sales further ahead, that investors/traders haven't been spooked by the poor data. 



Compared to this time last year, sale volumes are 2.7% lower, even though headline inflation has been halved during that time. The current levels are the same as during February 2021, when obviously extensive restrictions were in place across the UK. 



The BoE will view the numbers as confirmation that demand in the economy continues to falter in the face of high inflation and high interest rates. The former is at least clearly falling and to kick-start the economy again, the latter will have to follow suit at some point. This will leave a consumer positive, but GBP negative scenario. 



For now though, it has been a very good week for the Pound in what was a volatile period. However, this is not a trend that is expected by over 90% of data-analysts to continue and so it feels like another rare favourable opportunity to sell Sterling.