UK retail sales dropped by 1.8% in March marking the largest year on year decline since 2010 and exceeding economists’ predictions of a 0.5% decline.
Coinciding with the rise of inflation, the volume of goods sold in store and online fell 1.4% in the first quarter of the year. The Office for National Statistics (ONS) reported it as the first quarterly decline since 2013.
Average store prices increased 3.3% in the year to March, the highest rate of increase since March 2012.
Kate Davies, a ONS statistician, said that the sales weakness “seemed to be a consequence of price increases across a whole range of sectors.”
The increase in prices is expected to have an effect on volumes growth in the short term.
The Bank of England is predicting retail sales growth will continue to drop significantly this year due to the pressure of real incomes and the continued rise of inflation.