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JUNE RETAIL SALES UP

According to latest British Retail Consortium data, high-street sales bounced back in June as better summer weather boosted sentiment. As a result, the BRC says second-quarter figures were 2.1% up overall, with food sales lifted by 3.6% and other expenditure 0.9% up.

BRC chief executive Helen Dickinson was nevertheless circumspect about staying power and commented: “There’s a question mark over whether this spending momentum will last, as household expenditure is increasingly squeezed from rising inflation and slowing wage growth.”

The Office of National Statistics paints a gloomier picture. It has reported retail sales were down in May, along with a 0.2% fall in manufacturing output and construction sector decline of 1.2%.

Separately, an ONS release detailed a dramatic plunge in UK household savings. Only 1.7% of family income remained unspent in the first quarter of 2017, the lowest savings ratio since 1963. Over the past 54 years, the savings ratio had averaged 9.2% of disposable income but faded sharply over the past year.

Other sources were equally miserable. Halifax Building Society said UK house prices dropped by 1% in June. A joint report by economic researcher IHS Markit and Visa revealed total consumer spending had fallen to its worst level since 2013 in the second quarter. And, after a revised ONS estimate of first-quarter GDP growth at just 0.2%, big-league accountancy firm PricewaterhouseCoopers has concluded that the UK economy probably grew by only a sluggish 0.3% in the second quarter.

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