Report Summary

Period covered: March 2024

3 minute read

Note: This report summary is one or two months behind the current month as standard reporting practice. The content is indicative only and incomplete with certain data undisclosed. Become a member to access this data or take out a free 30 day membership trial now.

Retail sales

March’s nuanced landscape for retail spending saw overall sales growth at xx% year-on-year according to the Retail Economics Retail Sales Index.

Key factors impacting sales in the month include:

Mother’s Day and early Easter: The proximity of Mother's Day (10 March) and Easter (Good Friday, 29 March) pulled forward demand, particularly in food and gift-related categories. However, less was spent on big ticket gifts such as watches and jewellery, indicating a shift to lower cost indulgences.

Housing costs: The Bank of England's base rate remained at a xxxx high of xx%, keeping borrowing costs elevated. This is having an acute impact on those transitioning from fixed-rate mortgage deals to significantly higher rates, and in part leading to record high rental inflation at xx%.

Personal finances: A bumpy path to target xx% inflation is expected, but importantly real wages are now experiencing a modest rise. This wage uptick – alongside NIC reductions, an impending energy price cap decrease, and expected interest rate cuts – has seen perceptions on future personal finances improve.

Wet weather: March's weather was unsettled, ranking as the third wettest March since xxxx. This concentrated apparel sales to last season stock and impacted footfall, which nonetheless saw an increase as Easter holidays started earlier compared to last year.

Distorted backdrop

Key economic developments continued to shape household budgets and consumers’ willingness to spend on retail.

Consumer confidence remained unchanged at a pessimistic xx in March (GfK). However, households became optimistic about personal finances over the year ahead, amid murmurs of imminent interest rate cuts.

Although nominal wages have slowed on highs last year, importantly real wages are positive as inflation continues to ease (at xx% YoY in March).

Meanwhile, take-home pay has further been supported by a xx% National Insurance Contribution cut at the start of the year, with a further cut announced in the Spring budget from April.

However, the backdrop for personal finances is uneven across households, masked by headline figures. Interest rates were held in March at xx%. This has dragged more consumers into financial difficulty amid higher borrowing costs, which is impacting younger and affluent consumers key to spending.

Over half (xx%) of consumers said they have some concerns with their personal financial situation in April, up xx percentage points from the start of the year (Retail Economics).

Importantly, over a third (xx%) of consumers now have concerns about their level of credit card debt, while 12% said the repayment of debts and loans was their biggest concern in April – double the rate from January (Retail Economics).

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Retail Economics Retail Sales Index – Total Retail Sales