Summer weather helps retail sales surge

Retail sales hit their highest level in more than two years in August, official data showed on Friday, beating expectations.

According to estimates from the Office for National Statistics, retail sales volumes rose 1% in August, following an upwardly-revised 0.7% increase in July. Volumes were at their highest levels since July 2022.

Analysts, who expected sales growth to have slowed, had forecast a 0.4% increase.

In the year to August, sales jumped 2.5%, the largest annual rise since February 2022 and also ahead of expectations.

The ONS said supermarkets and clothing retailers in particular had benefited from warmer weather and end-of-season sales.

Food stores sales volumes surged 1.8% following a rise of 0.3% in July, and by 0.6% year-on-year - the largest annual increase since July 2021.

However, non-food stores sales volumes - which includes department stores and clothing retailers, among others - rose by 0.6%, down on July’s 1.6% rise.

In the three months to August, sales volumes rose by 1.2% on the three months to May.

Erin Brookes, European retail and consumer lead at consultants Alvarez & Marsal, said: "The warm weather, bank holiday weekend and high levels of tourism all contribute to a more robust month sales. Margins, however, likely remained under pressure, as retailers needed to clear through summer stock.

"Looking ahead, retailers will be pleased to see th arrival of the cooler autumnal weather, which should encourage spending on new season stock."