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A rebound will be dependent on the retail sector’s performance; the retail sector has long been an indicator of both economic health, and the confidence of consumers. Figures realised by the Office for National Statistics revealed a mixed report on UK retail sales figures earlier this year – though the forecast still remains variable.
According to statistics, retail sales during May grew by 2.1%. Financial experts have suggested that this summer is seeing a fluctuation of growth for retail – given the unpredictable weather the summer has so far shown, however, shoppers taking to the high street has not been consistent.
With that said, there’s been some truth in predications, as shown by the statistic released for July.
On the up?
July has recorded a jump in retail sales – a bigger jump than expected. This has no doubt caused a real boost in the UK economy.
Joshua Raymond from City Index commented:
The data we are seeing in the UK right now continues to point to a faster pace in the UK economic recovery later this year. Delving deeper into the numbers we saw a big increase in food sales, which rose by 2.5% in July alone and 2.1% annual, which is its biggest rise in food sales for over 2yrs.”
Since January 2011, UK retail trails have jumped 1.1% – a promising improvement on the forecast of 0.6%.
“The heat wave has clearly paid a role in this boost,” Raymond continues, “with more barbecues being lit for sometime.
“Yet still, the jump in sales echoes a strengthening confidence amidst the UK consumer which sends further positive signals for the UK economy going forward.”
However, the UK merchandise trade gap appears to have widened more than expected, with a shortfall of £8.5bn. When not taking into account the sales of oil, that deficit increased by £0.7bn, according to Raymond.
That said, the promising growth of the retail sector could be what the UK needs to pull itself out of its economic slump. Proving the growth continues at such a steady rate, there could be light at the end of the tunnel for investors and shareholders across the UK.