UK Retail Sales Miss Forecast as Consumer Spending Remains Weak

UK retail sales excluding fuel rose 2.3% year-on-year in July, falling short of the 3.3% forecast and signaling continued pressure on consumer spending.

The Office for National Statistics reported that retail sales volumes ex-fuel increased at a slower pace than analysts had expected, reflecting cautious household spending amid elevated living costs and lingering inflationary pressures.

Economists had anticipated a stronger rebound after a relatively resilient spring, but the July reading suggests that consumers remain reluctant to increase discretionary purchases.

The data comes as the Bank of England monitors spending trends for signs of demand-led inflation, which could influence future interest rate decisions.