Britain witnessed a surprise drop in claims for unemployment benefits in July, the immediate aftermath of the country’s vote in favour of exiting the European Union, official data showed Wednesday.
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The UK retail sales data was stronger than expected for July with a headline 1.4% increase in sales volumes following a 0.9% decline previously with markets expecting a 0.1% monthly advance.
The pound hit a two-week high on Thursday (18 August), after better-than-expected retail sales data showed British consumers had not been hit by the uncertainty following the Brexit vote in June.
The weak pound is likely to have played a role in boosting sales, drawing tourists to the United Kingdom to buy luxury items like jewellery and watches, said Howard Archer, the chief United Kingdom and European economist for IHS Global Insight.
Yesterday’s data from the Office for National Statistics, however, is the first official figures shedding light on consumer sentiment in the United Kingdom since the Brexit vote.
RETAIL sales have rebounded from their June slump, providing some assurance that Brexit is not deterring shoppers from splashing out. The GBP has also grown by 0.8 eurocents at 1.31631 now recovering from Tuesday’s 3 year low.
Joe Grice, chief economic adviser at the ONS, said warm weather could be a major factor in driving clothing and footwear sales, which he said did particularly well.
The Bank cut interest rates earlier this month from 0.5% to 0.25% as part of measures to boost the economy and has indicated that it could reduce the base rate further.
Earlier this week, British multinational retailing company Kingfisher said it had not seen any impact on business following the vote, with sales up in the last three months, Reuters reported.
Average earnings increased by 2.4% in the year to June, 0.1% up on the previous month.
The month-on-month increase came despite gloomy forecasts that figures could go up by as little as 0.1 per cent.
Howard Archer, chief United Kingdom and European economist for IHS Global Insight, added, “July’s jump in United Kingdom retail sales is a major boost to third quarter growth prospects – and occurred despite survey evidence showing consumer sentiment slumping after the vote for Brexit”.
Ex-minister Dominic Raab, a leader of the Brexit campaign, said: ‘Britain is going from strength to strength’.
The yearly figure saw a 5.9 percent rise, boosting confidence about the United Kingdom economy following the decision to quit the European Union.
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New UK retail sales figures out today suggest that consumers haven’t been too ruffled by the Brexit vote.
