UK retail sales report biggest annual drop since May – BRC

Dhwani Mehta FXStreet

The UK Retail Sales dropped to the lowest levels since May in January, hit by the renewed COVID-19 lockdown measures, which pressured the non-essential stores to close down, the latest data from the British Retail Consortium (BRC) showed Wednesday.

Key takeaways

“The trade body said that its members saw average prices fall by 2.2% in January compared with a year earlier, the largest such fall since the depths of Britain’s first lockdown in May.”

“Food prices rose by 0.2%, the smallest increase since January 2017, and non-food prices dropped by 3.6%.”

BRC Chief Executive Helen Dickinson said: “Post-Christmas sales and the national lockdown drove non-food prices down – especially for clothing and DIY goods.”

“Brexit-related red tape, rising global shipping costs and food commodity prices, as well as the weight of forced closures and restrictions for many retail businesses, means that pricing pressures are stacking up,” she added.

Market reaction

Amid cautious market mood-led the US dollar bounce and downbeat UK Retail Sales data, GBP/USD corrects from fresh two-and-half-year highs of 1.3752, now trading around 1.3735, almost unchanged on the day.

The cable gained in early trades, benefiting from the upbeat UK jobs report and improving covid situation in the Kingdom.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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