ONS Retail Sales January 2023

Retail sales (value, non-seasonally adjusted, exc. fuel) rose by just 3.2% year-on-year (YoY) in January according to the latest ONS data – continuing to significantly lag inflation.
In volume terms (non-seasonally adjusted, exc. fuel), retail sales declined by 5.9% YoY in January, against a 6.8% rise a year earlier.
Volumes have been in decline since March 2022 and are broadly on par with January 2021 levels, when the UK was facing its third national lockdown.
The three-month-on-three-month volume rate saw a decline of 1.0% in the quarter to December (volume, seasonally adjusted).

Retail sales value and volume growth remains detached

Source: ONS, Retail Economics analysis

Note: all retail sales figures provided below are non-seasonally adjusted, excluding Fuel, unless stated otherwise.

Food and non-food

Food sales values rose by 7.4% YoY in January, marking a softening on the 8.2% rise in December despite a weaker comparative (-1.3% in Jan 22). After accounting for strong double-digit food inflation, food volume declines deepened to -5.2% YoY in the month.
Non-food sales values rose 4.1% YoY in January, while volumes declined 5.0%.
Clothing sales values stepped up 18.5% YoY in January, against a 78.7% surge a year earlier. This saw volumes climb 10.2% in the month, with the quantity of clothing sold broadly at typical pre-pandemic levels for January.
Continued cold temperatures saw Footwear & Leather Goods sales values rise 23.9% YoY, with volumes rocketing 18.6% YoY in the month.
Households Goods faced a weak 1.8% YoY rise in values in January against strong comparatives. Volumes declined 6.0% in the month to below pre-pandemic levels.
Furniture & Lighting saw sales volumes dip 0.6% in January despite an 8.8% rise in values.

Online

Online sales values continued to decline, falling 9.0% YoY in January.
All major online categories recorded a decline in the month, with Clothing & Footwear the only notable exception as sales ticked up 2.1% YoY.
Non-store retailing (a proxy for pureplay retailers) saw sales decline by 9.5% YoY in January.
The proportion of retail sales made online slipped to 26.6% in January – down from 30.1% a year earlier, but ahead of a pre-pandemic peak of 21.6% in November 2019.

Retail sales price deflator

The retail sales deflator (a measure of inflation specific to retail) edged up to 9.7% YoY in January when excluding fuel – up from 9.2% in December.
The implied price deflator among food stores accelerated to 13.2% YoY in January, marking a seventh consecutive month of double-digit rises. Among non-food stores, the price deflator rose to 7.2% YoY in the month from 6.9% in December.