LONDON (Reuters) – British retail sales fell 1.4 percent more than expected month-on-month in September, according to official data on Friday, as consumers reacted to higher prices.
The September data was also affected by an extraordinary holiday at Queen Elizabeth II’s funeral, in which many businesses closed, according to the Office for National Statistics (ONS, for its English acronym).
Economists had expected retail sales to fall 0.5%.
Excluding auto fuel, sales were down 1.5% from August.
Consumers have been limiting their spending with inflation rising to 10% and also facing the prospect of an additional cut in their purchasing power in 2023 after Treasury Secretary Jeremy Hunt scrapped tax cuts earlier. It was planned by Prime Minister Liz Truss, who announced her resignation on Thursday.
An overnight survey showed consumer confidence hovering near a record low as households respond to a combination of high inflation and chaotic British politics.
Various retailers, including Tesco (LON:) – Britain’s largest supermarket group – and online fashion company ASOS, have warned of earnings expectations this month as they grapple with rising staff and energy costs and a weaker pound.
In annual terms, the total volume of sales fell 6.9%, according to the Office for National Statistics.
Another report from the Office for National Statistics showed that Britain borrowed 20.01 billion pounds ($22.37 billion) in September, an increase of 17.1 billion pounds expected in a Reuters poll of economists.
Hunt will try to show investors he can put public finances on a sound footing when he presents his budget plan on October 31, which is expected to include spending cuts and possibly new tax increases.
(dollar = 0.8945 pounds)
(Reporting by Ana Nicholas da Costa, Editing in Spanish by Benjamin Mijas Valencia)
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