UK retail sales excluding fuel grew 1.2% year on year, slowing from 1.6% previously. This marks a 0.4 percentage point decline in growth, signalling softer underlying consumer demand compared with the prior reading.
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The 1.2% increase also undershot analysts’ 1.6% estimate, reinforcing a weaker-than-expected spending backdrop. UK equities tied to discretionary retail, apparel, and consumer services are likely to face pressure as investors reassess earnings resilience, while defensive staples retailers may see relative support. The data leans toward a cautious sentiment-driven move in the near term but also feeds into expectations for a less aggressive Bank of England policy path if consumer momentum continues to fade.