Retail Sales Increase in July
Retail turnover rose by 0.6% in July, exceeding the expected increase of 0.2% by economists surveyed by Reuters. The good weather and the success of the England women’s team in the Euros are thought to have contributed to the increase in spending.
Strong Growth in Clothing and Online Sales
Clothing and shoe shops, as well as online purchases, recorded strong growth. This increase in sales is a significant indicator of consumer spending, which is the largest component of the British economy.
Three-Month Basis Shows Weaker Numbers
On a three-month basis, the numbers are weaker, with a decline in sales of 0.6%. This is partially due to downward revisions in July. The expenses have decreased since March, when supermarkets, sports shops, and household goods recorded strong sales at the beginning of the year.
Importance of Retail Sales
Retail sales are significant because they measure budget consumption, the largest expenses in the British economy. The growing retail turnover can mean economic growth, which is a top priority for the government.
Issues with the Numbers
The figures were originally supposed to be published in August but were delayed by two weeks to allow for quality assurance tests. After the checks, the Office for National Statistics (ONS) found a "problem" that meant they had to correct the numbers. This is not the only question mark over the reliability of ONS numbers, as trade figures in Great Britain were delayed in March due to errors from 2023.
Implications of the Mistake
As a result of the latest mistake, the monthly figures previously exceeded the monthly volatility in the first five months of 2025. The General Director of ONS apologized for the delay in publication and the mistakes. According to Rob Wood, the chief UK economist at Pantheon Macroeconomics, this could mean retrospective changes in the British economic growth rate.
Potential Impact on Economic Growth Rate
The economic growth rate in April may be reduced, and May increased, said Wood. However, he added that there would be no effect on the interest decision of the Bank of England. The mistake has raised concerns about the reliability of ONS numbers, and the office continues to advise caution when interpreting changes in the monthly unemployment rate due to concerns about data reliability.
