London (AFP) – British retail sales slid 1.2 percent in March, as “Beast from the East” freezing weather sliced demand for car fuel but boosted online purchasing, official data showed Thursday.
“The month-on-month growth rate fell by 1.2 percent due to a large fall of 7.4 percent from petrol sales; a likely consequence of adverse weather conditions, which impacted travel,” the Office for National Statistics (ONS) said in a statement.
Analysts’ consensus forecast had been for a drop of 0.6 percent.
The ONS added that “department stores were the only sector to show positive growth in March at 0.8 percent, with feedback from retailers suggesting that online offers for Mothering Sunday and Easter boosted Internet sales more than usual during the adverse weather”.
Britain suffered freezing temperatures from late February through to March as blasts of icy weather from Siberia engulfed Europe.
Thursday’s retail sales data had been keenly awaited by markets for further clues on the outlook for UK interest rates.
“The figures, combined with the inflation and labour market data earlier in the week won’t make for easy reading for the Bank of England which has been prepping investors for a rate hike… in May,” said Craig Erlam, senior market analyst at Oanda.
“Softer inflation and weak consumer spending at a time when the economy is growing at a slow pace and facing the uncertainty of Brexit makes the case for a rate hike less compelling.”
While a quarter-point rate hike to 0.75 percent remained likely next month, analysts said the Bank of England may now start to downplay the prospect of another increase later in the year.