UK shoppers stay cautious as fuel costs bite, surveys show

British shoppers maintained a cautious approach to spending in September, with fuel costs playing a significant role, according to recent surveys. The British Retail Consortium (BRC) reported a 1.3% increase in total retail sales compared to the previous year, although this figure was below the 12-month average of 1.5%. Barclays' consumer card spending data indicated a 2.0% increase in annual spending, a slight deceleration from August's 2.1% rise.

The BRC survey revealed that food sales grew by 2.5%, while non-food sales increased by 0.3%. Health and beauty products enjoyed their strongest month yet, and toy sales were boosted by Pokemon merchandise marking its 30th anniversary. However, clothing and footwear sales fell due to unseasonably warm weather.

Overall retail sales growth remained modest in September, as households continued to exercise caution due to anticipated increases in household bills and taxes, according to BRC chief executive Helen Dickinson. Barclays noted that essential spending rose by 2.5%, largely driven by a 17.3% surge in fuel expenditure following record-high diesel prices. Non-essential spending grew by 1.8%.

Pubs, bars, and clubs experienced a 3.8% increase in spending, marking their fourth consecutive month of growth, as the pleasant summer weather persisted into September. Despite this, 68% of consumers surveyed by Barclays expressed concern about the upcoming budget on October 28, potentially impacting their finances, and 30% reported cutting back on non-essential spending.