What's happened
Retail sales in the UK rose by 1% year-on-year in May, driven by a 3.6% increase in food sales. In contrast, China's retail sales grew by 6.4% in May, exceeding forecasts, as the country prepares for a major online shopping festival. Both markets face challenges amid rising costs and cautious consumer behavior.
What's behind the headline?
UK Retail Landscape
- Consumer Confidence: The British Retail Consortium (BRC) reported that while total retail sales increased, non-food sales fell by 1.1%, indicating cautious consumer spending.
- Economic Pressures: Retailers are facing £5 billion in extra costs from higher National Insurance contributions and wages, which may dampen future growth.
China's Retail Growth
- Strong Performance: China's retail sales growth of 6.4% in May was bolstered by government initiatives like a trade-in program for appliances, generating significant sales.
- Upcoming Events: The upcoming online shopping festival on June 18 is expected to further boost consumer spending, despite some regions halting trade-in programs due to funding issues.
Comparative Insights
- Diverging Trends: While the UK sees a slowdown in non-food sales, China is experiencing robust growth driven by government support and consumer enthusiasm for online shopping.
- Future Outlook: Both markets will need to navigate economic uncertainties, but China's proactive measures may provide a more favorable environment for retail growth in the near term.
What the papers say
According to the British Retail Consortium, UK retail sales rose by 1% year-on-year in May, primarily driven by a 3.6% increase in food sales due to bank holidays and sporting events. However, non-food sales decreased by 1.1%, reflecting cautious consumer spending amid rising costs (Josie Clarke, The Independent). In contrast, China's retail sales grew by 6.4% in May, exceeding forecasts, as the country prepares for a major online shopping festival. The National Bureau of Statistics noted that the growth was supported by government initiatives aimed at boosting consumer spending (South China Morning Post). This divergence highlights the differing economic landscapes and consumer behaviors in the two countries.
How we got here
The UK retail sector has been grappling with rising operational costs and changing consumer behavior, while China's economy is stabilizing despite external pressures, including US tariffs. Both markets are experiencing shifts in consumer spending patterns as they adapt to economic conditions.
Go deeper
- What factors are influencing retail sales in the UK?
- How is China's government supporting consumer spending?
- What are the predictions for future retail sales in both countries?
Common question
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Why Did UK Retail Sales Growth Slow in May 2025?
In May 2025, UK retail sales growth experienced a slowdown, raising questions about the factors influencing consumer spending. Understanding the dynamics behind this trend can shed light on the broader economic landscape and consumer behavior in the UK. Below, we explore key questions related to this topic.
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What are the latest retail sales trends in the UK and China?
As retail sales fluctuate globally, understanding the latest trends in the UK and China can provide insights into consumer behavior and economic health. This page explores the recent changes in retail sales, the factors influencing these trends, and what they mean for the global economy.
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