Singapore Markets close in 5 hrs 33 mins

Long live the high street: British shoppers are back out in force

Tim Wallace
Special offers from retailers encouraged shoppers to spend more in November - PA

UK retail sales rebounded strongly in November as shoppers proved they are not cowed by rising prices and struggling wage growth.

Sales volumes climbed by 1.6pc on the year, defying the 3.1pc rise in store prices, the Office for National Statistics said.

Volumes even rose in October as initial estimates of a drop in sales - the first in four years - was revised away, and in fact retail volumes held firm on the year.

“Consumer confidence seems to have recovered from the shocks which hit retail spending earlier this year - rising inflation and increased uncertainty surrounding the Brexit process,” said Andrew Sentance, senior economic adviser at PwC.

"December is a critical month for retailers, so we need to be cautious about reading too much into the underlying trend until we have passed the critical Christmas/New Year period. But these November figures provide some encouragement that consumer spending will end the year on a more positive note."

He did note that incomes are still strained by high inflation.

The amount of food purchased slipped 0.1pc on the year while purchases of clothes and shoes increased 2.3pc. Automotive fuel consumption rose 2pc.

While the volume of goods purchased rose by 1.6pc on the year, the amount of money spent to obtain those rose by 4.7pc, indicating the pace of price rises.

Millennials are more likely to embrace online shopping

This could mean shoppers are looking out for good deals.

Economists believe that the Black Friday sales may have encouraged families to bring forward their Christmas shopping to make the most of the special offers.

“In recent years, Black Friday discounting has generally led consumers to do their Christmas shopping earlier than usual, rather than making many additional purchases,” said Ruth Gregory at Capital Economics.

“Stronger growth in sales volumes in November has been offset by falls in December since the UK’s adoption of Black Friday discounting. As a result, some weakening in December seems likely – although a big boost from ‘Cyber Monday’ (which is captured in December’s figures) could provide some offset.”

She expects inflation to start to ease back and pay growth to recover a little in the new year, which could give retailers some extra support into 2018.