Ritika Janiya
Retail sales in Great Britain were reported as enjoying a fillip in July, which saw a strong performance during Euro 2024 and some summer shine. Whilst the general trend was up by 0.5%, many shoppers were still cautious of making that big long-term purchase due to the high cost-of-living. Retailers hope for further improvement in spending after interest rate easing.
Great news arrived for Great Britain’s retail sector when sales started rising by 0.5% in July, which could be characterized as a shower in August; the previous month was tough. June saw sales drop by 0.9%, partly due to dreary weather. The increase in July was partly due to the Euro 2024 football tournament, during which England got the whole country in a spending mood with their exciting journey to the final.
Rubbish. That was the situation last June when bad weather had kept shoppers away from stores, causing a decline in volumes turned in by retailers. However, the Office for National Statistics said that retail sales volumes rose by 0.5% last month, which was in line with economists’ expectations. But July brought the end of the Euros, and the summer weather starting to come out.
Liz McKeown, a director of economic statistics at the ONS, said that department stores and sports equipment shops experienced growth in sales. “Sales were boosted by both the Euros and discounts in many stores,” she added. However, not all the shops did well. Clothing and furniture shops had a tough month, and fuel sales had gone down too despite the drop in gas prices.
July’s sales included grocery, sports equipment and electronics. It was saved by the turned-out-to-be loss to Spain in the final of Euro 2024, which will have helped the numbers just a little, along with additional bounce from interest in the forthcoming Paris Olympics. Scotland also played but, predictably enough, did no better than the group stages.
Fashion sales did so badly at this time because shoppers were more into activities and experiences for the summer, as opposed to refreshing their wardrobes or changing all the home furniture. The cost of living is undoubtedly high, so people are very conscious of how and where they spend money on big-ticket items.
As Kris Hamer at the British Retail Consortium said, “Enduring the pain of a high cost of living is one thing, if there is light at the end of the tunnel.” Meanwhile, interest rates are finally coming down and, on the back of that, most retailers are hopeful that consumer confidence and spending will actually come through. This month, the Bank of England reduced interest rates from 5.25% to 5%, thus easing the money pressure on households.
At the same time, inflation increased to more than 11% in the energy and food price crisis due to the war in Ukraine. However, it is well below its level some time ago; it was at 2.2% this July, compared to 2% in June.
Still, Kien Tan from PwC UK is optimistic: “Whilst some of the retail sectors had a tough time in July, things are bound to pick up quickly. And, better summer weather will also help boost sales in grocery and fashion,” he says. About rises in wages, low inflation, and interest rates, people may once again start looking to spend more money headed into the holiday season.
Jacqui Baker of RSM UK added that July had also seen the UK summer finally arrive, with perfect BBQ weather and just right for any outside activity. She said all the build-up to the Euros, Wimbledon and the blossoming hope around another Olympics spurred the public on to part with their cash for new sports equipment. “The recent general election result has also given more confidence to the people, and it might further improve the retail sales,” she said.
In general, the growth in sales in July is optimistic due to Euro 2024 and better weather. Retailers hope this momentum will hold on and see a rebound from the downturns they had in preceding months. As the summer rumbles on and thoughts turn to the festive season, shoppers and stores alike are waiting for increasingly better days.
This redo keeps the integrity of the article intact but drives it down a bit to the level where an eighth grader would get it. It has a cheerful vibe, with Euro 2024 and summer weather being the drivers of retail sales, all with a slight pullback of not totally discounting present challenges.
