Retailers see unexpected slump in sales across October as Budget hits consumer confidence
Experts said concern around the Budget and the wait for Black Friday were the driving factors
UK retailers saw an unexpected slump in business across October as shoppers "brace for difficult news" ahead of the Budget.
Listen to this article
Released figures show the volume of sales fell by 1.1 per cent last month, which represents the first month-on-month fall since May.
The industry saw a 0.7 per cent boost in September, and economists forecasted an unchanged picture for last month.
In the three months to October, the Office for National Statistics (ONS) said retail sales lifted 1.1 per cent compared with the previous three months.
Read more: Shock winter rise to energy bills will leave Brits paying £1,758 per year
Read more: Lockdown could have been avoided, Covid inquiry finds
But the recent drop shows a raft of retailers reporting that shopper spending has pulled back due to uncertainty over the upcoming Budget, including high street stalwart Marks & Spencer.
Separate figures released by GfK on Friday showed consumer confidence has fallen across all measures this month as it said the public is "bracing for difficult news" in the Budget.
The ONS said that retailers were also seeing some spending held back in October ahead of this month’s Black Friday promotions.
ONS chief economist Grant Fitzner said: "Supermarkets, clothing stores and online retailers all saw slower sales, with feedback from some retailers that consumers were waiting for November's Black Friday deals."
Chancellor Rachel Reeves will deliver the Autumn Budget on Wednesday where she will reportedly stick to manifesto pledges and freeze income tax.
She however is predicted to raise taxes elsewhere.
Rajeev Shaunak told the Guardian: "The uncertainty surrounding what the Chancellor's budget will mean for individuals is only further dampening consumer confidence and spending intentions.
"The Christmas trading period will be critical, and early sales indicators are expected to confirm that consumer demand remains sluggish, creating a perfect storm for retailers."