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ONS statistics show retail's sustained growth in volume, but ongoing declines in value for May

Published:  19 June, 2015

The Office of National Statistics for May 2015 figures show one of the longest sustained periods of volume growth in the retail sector, while simultaneously showing that prices are continuing to fall for retailers as supermarket price wars rage on.

The Office of National Statistics for May 2015 figures show one of the longest sustained periods of volume growth in the retail sector, while simultaneously showing that food prices are continuing to fall for retailers as supermarket price wars rage on.

Volumes sales increased for the 26th consecutive month up 4.6% for May 2015 compared to May 2014, according to ONS figures released yesterday.

Further the data shows for the last three-month-on-three month comparison quantity bought has increased 0.6% for 27th consecutive month. The figure marks the "longest period of sustained growth since consistent records began in June 1996," according to the ONS statement.

Average store prices dropped for the 11th consecutive month down 2.07% in May 2015 compared to May last year. The price declines are inpart do to falling food prcies in the retail sector. According to this month's most recent Kantar Worldpanel figures prices have been declining steadily since September 2014.

A silver lining to this month's figures is that price declines do seem to be slowing for supermarket retailers. "While like-for-like groceries are 1.9% cheaper than this time last year, this is not as steep a fall as last month, when prices were down by 2.1%," said Fraser McKevitt, head of retail and consumer insight at Kantar World Panel.

In May 2015 for every pound that was spent in the retail industry, 41pence was spent in food stores, which include supermarkets, specialist food stores and sales of alcoholic drinks and tobacco. But yet most of the volume growth has been in 'non-food' stores according to the ONS report figures.  

Graph 2 

This could be a warning that despite the price drops that consumer have seen in grocery stores, the sector that is benefiting most from the increase in consumer real wages is actually going to 'non-food' stores like clothing, footwear and household goods stores.

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