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| UK retail sales in sharp fall in September, ONS says | |
| (35 minutes later) | |
| Retail sales suffered an unexpectedly sharp fall of 0.8% in September, reversing a jump in August, according to the Office for National Statistics. | Retail sales suffered an unexpectedly sharp fall of 0.8% in September, reversing a jump in August, according to the Office for National Statistics. |
| It meant that third-quarter retail growth slowed to a year-on-year rate of 1.5%, its lowest since the second quarter of 2013. | It meant that third-quarter retail growth slowed to a year-on-year rate of 1.5%, its lowest since the second quarter of 2013. |
| The figures come at the Bank of England contemplates its first interest rate rise in a decade. | The figures come at the Bank of England contemplates its first interest rate rise in a decade. |
| Sterling fell as traders bet the data made imminent rate rise less likely. | |
| Despite September's sales fall, Kate Davies, ONS statistician, said: "There is a continuation of the underlying trend of steady growth in sales volumes following a weak start to the year, and a background of generally rising prices." | |
| The ONS said retail prices continued to rise across all store types and were up 3.3% from a year earlier, the highest year-on-year increase since March 2012. | The ONS said retail prices continued to rise across all store types and were up 3.3% from a year earlier, the highest year-on-year increase since March 2012. |
| The biggest downward pressure on sales volume and value in September was in non-food stores. Food stores also reported falls in both measures, but to a lesser degree than non-food outlets, the ONS said. | The biggest downward pressure on sales volume and value in September was in non-food stores. Food stores also reported falls in both measures, but to a lesser degree than non-food outlets, the ONS said. |
| Online sales values increased year-on-year by 14%, accounting for approximately 17% of all retail spending. | Online sales values increased year-on-year by 14%, accounting for approximately 17% of all retail spending. |
| Ian Gilmartin, head of retail and wholesale at Barclays Corporate Banking, said: "It's important to avoid overstating the negatives in September's retail sales, as retailers did manage to post year-on-year growth despite the range of headwinds they are battling currently." | |
| However, he said September's fall, following strong sales in August, was "worse than predicted". | |
| Neil Jones, Mizuho's head of hedge fund currency sales in London, said the retail data was "not encouraging". | Neil Jones, Mizuho's head of hedge fund currency sales in London, said the retail data was "not encouraging". |
| The value of pound fell immediately after the figures were released, with sterling down almost half a cent to $1.3126, suggesting traders believe a rate rise next month is less likely. | |
| Bank governor Mark Carney has said rates could go up in the "relatively near term", with many analysts expecting a hike in November. | |
| Alvin Tan, currency strategist at Societe Generale, said that he still felt a rate rise next month was possible, but said a second rise early next year was now very unlikely. | |
| Ian Geddes, head of retail at Deloitte, said a November rate rise "could come at a challenging time for the retail sector". | |
| With rising inflation and increasing consumer debt, a rate hike just as the industry enters the key Christmas period would be "an additional headache for retailers", he said. |