{"id":499119,"date":"2026-03-27T23:43:15","date_gmt":"2026-03-27T23:43:15","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/499119\/"},"modified":"2026-03-27T23:43:15","modified_gmt":"2026-03-27T23:43:15","slug":"sales-decline-as-shoppers-rein-in-spending-even-before-iran-war","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/499119\/","title":{"rendered":"Sales decline as shoppers rein in spending \u2014 even before Iran war"},"content":{"rendered":"

Retail sales dipped for the first time in three months in February as British supermarkets reported weaker volumes and wet weather dampened demand for household goods.<\/p>\n

Figures from the Office for National Statistics (ONS) showed retail sales volumes fell by 0.4 per cent last month after staging a recovery in January, when sales rose by 2 per cent.<\/p>\n

The decline was less than the 0.7 per cent expected by analysts but predated the onset of the Iran war<\/a>, with retailers bracing for an extended period of disruption as the conflict dials up inflationary pressures globally.<\/p>\n

Consumer spending is expected to take a hit as household energy bills rise<\/a>, while a number of retailers have said they may have to raise prices if the war continues, given ongoing supply chain disruption. Next, the FTSE 100<\/a> retailer, became the latest to warn of possible price increases on Thursday alongside weaker consumer demand.<\/p>\n

Sales volumes rose by 0.7 per cent in the three months to February compared with the previous quarter, the ONS said, with strong performances from online shops and art dealers. That helped offset a weaker period for clothing retailers. Video games, wine and sports supplements have all sold well since the start of the year.<\/p>\n

While sales volumes for the year to February rose by 2.5 per cent, this was slower than the annual growth of 4.5 per cent reported to January.<\/p>\n

Rajeev Shaunak, head of consumer at the accountancy MHA, said the data was \u201cnot as bad as feared\u201d but highlighted \u201chow vulnerable retail spending remains to external pressures\u201d.<\/p>\n

Amid concerns about inflation and with interest rate expectations<\/a> \u201cfinely balanced\u201d, he said households were likely to \u201cremain cautious, prioritising essential spending and limiting discretionary purchases\u201d.<\/p>\n

Melissa Minkow, global director of retail strategy and insights at CI&T, the business technology company, said shoppers were \u201ctaking more time to weigh up pricing, timing and necessity before they commit\u201d.<\/p>\n

Separate data on Friday showed consumer sentiment weakened to its lowest level in nearly a year in March. GfK\u2019s long-running consumer confidence index dropped to -21 this month from -19 in February with households particularly concerned about the wider economic situation.<\/p>\n

Neil Bellamy, consumer insights director at GfK, said: \u201cA ripple of fear is spreading, as is evident \u2026 people simply do not feel the economy is robust enough to ride out the knock-on effects from the Middle East conflict.\u201d<\/p>\n

Matt Swannell, chief economic adviser to the EY Item Club, said the outbreak of the conflict in the Middle East had further worsened the outlook for the\u00a0retail\u00a0sector, and there were also early signs that the fallout from the conflict has hindered consumer sentiment, which could further prompt households to delay some spending decisions.\u201d<\/p>\n

Ashley Webb, UK economist at Capital Economics, said the modest month-on-month fall in retail sales volumes in February meant that sales volumes held onto most of their gains at the start of this year. However, he added: \u201cThe decline in GfK consumer confidence in March due to the stagflationary concerns caused by the Iran war is probably the start of a bigger fall and suggests real household spending growth will soften in 2026.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Retail sales dipped for the first time in three months in February as British supermarkets reported weaker volumes…\n","protected":false},"author":2,"featured_media":499120,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[84,1294,56,54,55],"class_list":["post-499119","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/499119","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=499119"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/499119\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/499120"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=499119"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=499119"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=499119"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}