UK Retail Sales MM (Nov) 1.3% vs. Exp. 0.4% (Prev. -0.3%)

• Non-food store sales volumes rose by 2.3% in November 2023, following a 0.2% increase in October 2023; retailers suggested that earlier Black Friday sales and wider discounting contributed to the increase.


• 
  Three-month on three-month sales volumes fell by 0.8% in November 2023, continuing a trend seen in recent months.


• Automotive fuel sales volumes rose by 0.6% in November 2023, following a fall of 1.7% in October 2023. Retailers suggested the increase over the month was supported by falling fuel prices.
  


• "The reporting period for this bulletin covers 29 October to 25 November 2023. The official Black Friday day of promotion was 24 November and is included in our reference period. However, many retailers had Black Friday deals throughout the month of November. Cyber Monday will be included in December's release as it took place on 27 November."

via ONS

Reaction details (07:03)

• Following the across-the-board strong retail sales data, GBP/USD spiked higher from 1.2680 to 1.2715 before pulling back to levels just below 1.27.

Analysis details (07:14)

• A stronger-than-expected release which sparked a bid in GBP but no real follow through to EGBs (Gilts yet to open). Retail volumes in November were supported by Black Friday (note, Cyber Monday falls within December's survey period) with retailers suggesting that "earlier Black Friday sales and wider discounting" supported the release. On the latter point, automotive fuel sales increased by some 0.6% (prev. -1.7%), supported by a reduction in fuel prices.


• However, ONS does caveat that the less volatile 3M/3M figure saw sales volumes -0.8% for November's reference period, "continuing the trend seen in recent months".


• Overall, a strong figure and has served to offset the negative revisions to Q2 & Q3 GDP (click here for more) in terms of the Sterling reaction. However, it remains to be seen if this is the beginning of a sustained lift for retail volumes after recent poor performance given the influence of Black Friday and discounting on this release and the yet to be estimated impact of Cyber Monday on December's figure, due 19th January.

22 Dec 2023 - 07:00- ForexData- Source: Reuters