UK retailers delivered a fourth consecutive month of sales growth in September, defying economic headwinds as consumers continued spending despite broader concerns about the economy. The retail sector benefited from strong technology sales and increased demand for gold jewellery.
The Office for National Statistics reported retail sales volumes rose by 0.5% in September, surprising analysts who had predicted a 0.2% decline. This followed a 0.6% increase in August, which was revised higher, demonstrating resilient consumer activity.
Technology retailers saw particularly strong performance following the September launch of the iPhone 17, which boosted computer and telecommunications sales. Online jewellers also contributed significantly to growth, reporting strong demand for gold amid continued price rises for the precious metal.
Online retail surge drives growth
Non-store retail volumes, predominantly covering online firms, jumped by 1.5% to reach their highest level since February 2022. This helped push total retail sales volumes to their strongest position since July 2022, with online retailers leading the recovery.
The technology and telecommunications sector experienced notable growth thanks to product launches, with the new iPhone 17 release providing a significant boost to September sales. Online jewellery retailers capitalised on rising gold prices to attract consumers seeking precious metal investments.
However, traditional retail categories showed mixed performance, with food stores and department stores both reporting volume declines during the month. This highlighted the uneven nature of the retail recovery across different sectors.
Experts see cautious optimism
Kien Tan, senior retail adviser at PwC UK, said shoppers "still seem to be cautiously spending more" despite signs of pressure on consumer sentiment. He noted that autumn weather helped fashion sales, with clothing retailers continuing strong performance.
"However, autumn showers also discouraged shoppers from visiting physical stores, as high street footfall fell and the proportion of sales online increased to 28%, which is the highest penetration of online retail since the end of the pandemic," Tan added.
Matt Swannell, chief economic adviser to the EY Item Club, predicted modest improvements would continue over the next 18 months despite challenges. He cited weaker wage growth, sticky inflation and tighter fiscal policy as headwinds, but noted improved consumer confidence could help households maintain spending by reducing savings.
Sources used: "Office for National Statistics", "PwC UK", "EY Item Club"
Note: This article has been created with Artificial Intelligence (AI).
