UK retail sales rose in February

UK retail sales increased 0.4% in February on the previous month, according to figures released by the Office for National Statistics (ONS).

The increase, which beat what economists had forecast, follows a 0.9% rise in retail sales in January.

Sales at food stores declined 1.2% in February, the biggest drop since December 2016, however, this was offset by growth in all other main sectors.

In the three months to February 2019, sales rose by 0.7% when compared with the previous quarter. Year-on-year growth sales in February 2019 increased by 4.0%, with growth in all main sectors.

Rhian Murphy, the ONS’s head of retail sales, said the bounce back has been driven by increases in online shopping and fuel sales.

She said: “Food growth slowed, however, due to a significant fall for supermarkets, specialist food and alcohol stores in February after the sales and promotions seen in January came to an end.”

Paul Dales, chief UK economist at Capital Economics, was quoted by the BBC as saying:

“With just eight days to go until Brexit and the uncertainty higher than ever, it is reassuring that in February households increased their spending at a decent rate.

“And February’s public finances data suggest that the chancellor has the cash to splash if there were a no-deal Brexit.”

UK borrowing

A separate report on public sector finances revealed that borrowing (public sector net borrowing excluding public sector banks) in February 2019 was £0.2 billion – £1.0 billion less than in February last year and lower than what economists had expected.

Public sector net debt at the end of February 2019 was £1,785.6 billion, or 82.8% GDP – £22.7 billion higher compared to February 2018, but 1.4 percentage points lower as a proportion of GDP.