After an apparent kick-start in February the muted recovery of retail sales continued again in March. The current release of the Retail Sales Index indicates this.
The annual change by volume has been positive for the past two months. The annual change by value remains negative, because of price effects and possible bargain hunting, but has eased for the sixth month in a row to –1.6%. We are a long way from the rates of decline seen 12 months ago.
Of course, the caveat is that the all-businesses index is heavily weighted towards the motor trades. Motor trades make up 29% of the index in March and with new car sales in March up 78% on the same month last year, according to SIMI, this is bound to have a big effect on the all-businesses index.
Here we look at the index excluding motor trades.
Here we see that the annual declines have yet to unwind. Excluding motor trades, retail sales by value (-5.3%) and volume (-1.2%) are still lower than this time last year. Looking at the more recent monthly changes we see a more positive picture. When compared to February both value (+0.7%) and volume (+0.6%) have increased.
By volume, the monthly change in retail sales excluding motor trades has been positive for the first three months of the year with increases of 0.5%, 1.0% and 0.6%. We previously thought that the monthly change by value had been positive for February, but the preliminary estimate of +0.2% has been revised to –0.1% in the current release.
Looking at the actual index values we can see the slight upswing in the volume index represented by the above monthly increases. For the value index, it does appear that the index has ‘bottomed out’ but the signs of growth following a jump of 1.2% in January eased somewhat with the 0.1% drop in February. The 0.7% increase in March puts us back in a positive direction again.
9 hours ago