In April 2025, the UK retail sector experienced a notable uplift, with retail sales volumes increasing by 1.2% month-on-month, surpassing economists' expectations of a 0.2% rise. This marks the fourth consecutive month of growth and the strongest quarterly performance since July 2021. The surge was largely driven by a 3.9% rise in food store sales, attributed to the sunniest April on record, which encouraged consumer spending. However, non-food stores saw a 0.7% decline in sales volumes, primarily due to decreases in clothing and other non-food categories following strong growth in March.
Year-on-year, retail sales volumes rose by 5.0%, the largest annual increase since early 2022. Despite this growth, sales volumes remain 0.6% below their 2019 average, indicating that the sector has not fully recovered to pre-pandemic levels.
Consumer confidence also showed signs of improvement in May 2025. According to GfK's Consumer Confidence Index, the overall score rose by three points to -20, marking a two-month high. Notably, optimism about personal finances over the next year turned positive, gaining five points to reach an index of 2. Additionally, the major purchase index, which reflects consumers' willingness to make significant purchases, reached its highest level since 2024.
These developments suggest a cautiously optimistic outlook for the UK retail sector, as improving weather conditions and easing global trade tensions contribute to enhanced consumer sentiment and spending.
