UK retail sales fall 0.4% in September, more than forecast

Published Fri, Oct 23, 2026 · 03:30 PM

[LONDON] UK retail sales fell in September, as shoppers bought less food and above-average temperatures hit demand for autumn clothing.

The total volume of goods sold online and in stores declined 0.4 per cent after a revised 0.7 per cent increase in August, the Office for National Statistics said on Friday (Oct 23). Economists expected a 0.1 per cent drop.

Sales for the third quarter as a whole rose 0.7 per cent, contributing 0.03 percentage point to total economic growth.

British consumers, who drive about 60 per cent of economic activity, have weathered the Iran shock better than expected with spending over the summer, boosted by political optimism, warm weather and the Fifa World Cup.

However, a survey earlier on Friday found confidence collapsed in October, adding to signs that they are starting to feel the squeeze.

The downturn came after diesel hit a record £2 (US$2.68) a litre and mortgage rates neared 6 per cent.

Britons, meanwhile, are bracing for a New Year surge in energy bills that is expected to drive inflation above 4 per cent and force the Bank of England to raise interest rates as early as November.

Chancellor of the Exchequer John Healey has signalled he plans to announce fresh help with the cost of living in Budget on Oct 28, but he has little room for major giveaways, given the state of the public finances. BLOOMBERG