Experts have cautioned against blaming Brexit for the dip in consumer spending and say it may even boost sales of big-ticket items.
Recent figures from the Office of National Statistics (ONS) revealed that the amount spent in the retail industry in June decreased by 0.9 per cent compared with May. However, compared with the previous year it increased 1.5 per cent.
In June 2016, the number of retail sales increased 4.3 per cent compared with June 2015.
Average store prices fell by 2.5 per cent in June 2016 compared with the same period last year and online sales increased by 14.1 per cent compared with May.
Partner and head of retail and wholesale at Wilkins Kennedy LLP, Phil Mullis, said: “It is far too early to tell if the Brexit vote has had an impact on consumer spending. Yes, there have been falls in spending in the grocery sector, for example, but that is far more likely to be due to the constant price squeezes in the supermarkets. In fact, there are still plenty of sectors reporting sales increases, including furniture, home accessories, household appliances and jewellery and watches.
“We could actually see a spike in spending in the short term, especially for bigger ticket items, as retailers are still selling existing stock at ‘old’ prices. Once these revenues run low, that’s when we could see consumers hesitating on purchases, which could cost more due to currency volatility and increased fuel prices.
“Will retailers choose to pass on those increased costs to the customer or will they take a hit to profits? Let’s see what July and beyond brings.”