Hotels, pubs and restaurants ‘feeling impact of caution over Brexit’

SHOPPERS continued to show a reluctance to spend in February amid Brexit uncertainty as retail sales showed more sluggish growth than a year earlier.

Total retail sales increased by 0.5% year on year in February - showing lower growth than a 1.6% annual increase seen in February 2018, the BRC (British Retail Consortium)-KMPG retail sales monitor said.

The report was released as a separate study from Barclaycard indicated that pubs and restaurants, which tend to perform relatively strongly, are not immune from the impact of shoppers cutting back.

Barclaycard’s research also suggests a significant number of consumers are stockpiling essential food items in case of future shortages.

The BRC-KPMG report showed that, on a like-for-like basis, UK retail sales decreased by 0.1% from February 2018.

Paul Martin, UK head of retail at KPMG, said shoppers are “focusing on the essentials”, with non-food retail categories under more pressure than the grocery category.

Over the three months to February, food sales increased 1.3% on a like-for-like basis. The same period saw non-food retail sales decrease by 0.6% on a like-forlike basis.

Mr Martin said: “Across all categories there was sluggish growth, and the milder weather appears to have shifted the focus away from indoors, with furniture sales declining - and not even Valentine’s Day could boost sales in the stationary category. However, the full impact of the recent unseasonably warm weather is yet to be seen, especially for the clothing categories, and online sales growth remained steady.”

Helen Dickinson, chief executive of the BRC, said: “Uncertainty surrounding the UK’s imminent exit from the European Union has hit consumer spending.”