Retail sales volumes suffered their largest monthly fall since December 2023 last month, according to official figures which suggest a link to rising bills.
The Office for National Statistics (ONS) reported a 2.7% decline in the quantity of goods bought in May compared with the previous month.
The body said its interaction with retailers suggested “inflation and customer cutbacks” accounted for the fall, which was across all categories, but led by food.
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The seasonally adjusted data – which reflects the effects of holidays – means that those for Easter are modified to give a clearer picture of sales trends.
A poll of economists by the Reuters news agency had expected to see a decline in volumes of just 0.5% in May following April’s growth of 1.3%.
May was the month when households would have noticed the hit from the so-called ‘awful April’ above-inflation hikes to essential bills, including council tax, water, mobiles, broadband and energy.
Retail sales growth had proved to be resilient this year until May but April brought a number of additional curveballs to confuse sentiment and place pressure on the economy generally.
Donald Trump’s “liberation day” tariff regime kicked in while Budget measures, including rises to minimum pay levels and employer national insurance contributions (NICs), also placed additional costs on businesses.
Retail is the UK’s largest private sector employer. It had threatened higher prices and hits to hiring and wage growth ahead of the tax take coming into effect.
While the inflation picture for May was largely flat, the…
