UK retail sales growth at slowest level in four years

 
Caitlin Morrison
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Prices rose at their fastest rate in five years in September (Source: Getty)

The pound has dropped against the dollar and the euro after official data showed UK retail sales growth in September was at its slowest level for four years, as price growth jumped again.

Sterling fell 0.58 per cent against the euro at €1.1137, and was down 0.37 per cent against the dollar at $1.3156.

According to figures from the Office for National Statistics (ONS), year on year, the quantity bought in the retail sector increased by 1.2 per cent, with non-food (household goods, clothing stores) and non-store retailing all providing growth.

The ONS reported a 0.8 per cent monthly decline in retail sales in September.

"However, there is a continuation of the underlying trend of steady growth in sales volumes following a weak start to the year, and a background of generally rising prices," said ONS senior statistician Kate Davies.

"These increased costs are reflected in the more rapid growth in the amount spent when compared with the quantity bought."

Store prices continue to rise across all store types and are at their highest year-on-year price growth since March 2012 at 3.3 per cent.

Earlier this week, it was revealed that inflation rose to three per cent last month, its highest since April 2012.

"Today’s retail figures will be of concern to Theresa May, with evidence growing to suggest that Britain’s shoppers are keeping wallets in pockets against a backdrop of growing uncertainty," said Dennis de Jong, managing director at UFX.com.

"Five-year high inflation combined with slow wage growth has consumers feeling the pinch. A rising cost of living is never popular, and there will be growing calls for an interest rate intervention next month.

“With Brexit top of the agenda for the foreseeable future, Britain’s high streets may well be relying on a Christmas rush to kick start the sector."

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