UK Retail Sales drop 1.4% MoM in March vs. -0.3% expected

• The UK Retail Sales came in at -1.4% MoM in March, a downside surprise.
• Core Retail Sales for the UK dropped by 1.1% MoM in March.
• The cable is testing lows just above 1.3000 on the disappointing UK data.

The UK retail sales arrived at -1.4% over the month in March vs. -0.3% expected and -0.5% previous. The core retail sales, stripping the auto motor fuel sales, stood at -1.1% MoM vs. -0.4% expected and -0.9% previous.          

On an annualized basis, the UK retail sales rose by 0.9% in March versus 2.8% expected and 7.2% prior while the core retail sales decreased by 0.6% in the reported month versus 0.7% expectations and 4.7% previous.

Main points (via ONS)

“Food store sales volumes fell by 1.1% in March 2022 and have fallen each month since November 2021; higher spending in pubs and restaurants linked to reduced coronavirus restrictions, as well as the impact of rising food prices on the cost of living, are possible factors for reduced spending in food stores.”

“Automotive fuel sales volumes fell by 3.8% in March 2022 with other data sources indicating that some non-essential road travel had been reduced following record high petrol and diesel prices.”

“Non-food store sales volumes rose by 1.3% in March 2022 because of growth in other non-food stores (2.9%), and household goods stores (2.6%) such as DIY stores.”

FX implications

GBP/USD has tested the daily lows at 1.3011 on UK Retail Sales miss. The spot was last seen trading at 1.3019, down 0.05% on the day.