By William Schomberg and David Milliken
LONDON (Reuters) – British retail sales fell by the most on record in March as a surge in food buying for the coronavirus lockdown was dwarfed by a plunge in sales of clothing and most other goods, official figures showed on Friday.
Sales volumes plunged by 5.1% in March from February, the sharpest drop since the Office for National Statistics records began in 1996. It was also a bigger fall than the median forecast for a drop of 4.0% in a Reuters poll of economists.
The data covered the period from March 1 to April 4 including two weeks of the government’s shutdown of much of the economy.
Britain’s economy could he heading into its deepest recession in more than 300 years, according to the country’s budget forecasters, even after the finance ministry and the Bank of England rushed out a string of emergency stimulus measures.
“With widespread lockdowns only beginning around the middle of March, retail spending looks like it will fall by much more in April,” said Thomas Pugh, an economist with Capital Economics, adding a monthly fall of 20%-30% was possible.
“Clearly there is huge uncertainty as to how deep the downturn proves and how long restrictions remain in place, a fall in the region of 25% in GDP over the next few months seems likely,” he said.
Britain’s store-based retailers, outside of food, have been severely hit by the lockdown to counter the pandemic, with already-weak firms such as Laura Ashley, Debenhams and Oasis Warehouse falling into administration over the past month.
The ONS said a longer-running series that excludes fuel sales dropped by the most since it began in 1988, down by 3.7% on the month.
Food sales volumes were up by a record 10.4% in March from February as people stocked up for the government’s stay-at-home order. Sales of alcohol at specialist stores rose by a record 31.4%. But clothing sales tumbled by 34.8%, the ONS said.
Compared with March last year, total sales were down 5.8%, also a bigger fall than expected by economists in the poll and the largest on record.
Department stores saw monthly sales growth in March – up 2.8% – helped by their online sales capability. Non-store retailing, covering online, rose 5.9%.
(Reporting by William Schomberg; editing by David Milliken, Larry King)