UK retail sales trends

UK retail and grocery sales showed subdued growth in September, with total retail sales increasing by 1.3% year-on-year. This represented a slowdown from the 2.3% growth recorded the previous year. During this period, food sales grew by 2.5%, while non-food sales remained largely flat at 0.3%. Analysts noted that consumers were becoming increasingly selective, prioritizing essential items and small indulgences while postponing larger discretionary purchases due to cost-of-living concerns and anticipation of the Autumn Budget.

By October, retail sales in discretionary categories, such as fashion, lifestyle, and homewares, grew by 4.6% year-on-year, marking the strongest growth since January 2025. This increase was attributed to a drop in temperatures encouraging the purchase of autumn and winter clothing. A notable divide emerged between shopping methods: online sales rose by 10.1%, whereas physical high street sales grew by only 2.2%. Despite this boost, analysts indicated that consumer confidence remains fragile.