The messages emerging from the retail sector are very mixed. GfK’s UK Consumer Confidence Index soared in June to its highest level since the late 1990s, with consumers increasingly bullish about both their own financial prospects and the health of the economy overall.
This optimism has partially filtered through to retail sales. In the 3 months to May, the ONS reported that retail sales volumes were up 4.7% year-on-year. Values were up by a more modest 2.6%, reflecting widespread deflation in the market – good for consumers, far less so for retailers.
Footfall trends are far less positive. BRC/ Springboard Footfall Monitor reported a 3-month average decline of -0.5% in May. The decline in traffic was steepest in shopping centres (-2%). There is clearly still some disconnect between consumer confidence and actual shopping behaviour.