Retail sales fall in April as consumers hit by Middle East uncertainty

This was more than double the fall that was expected (0.6%) in a poll of Reuters economists. 

A lot of the drop was driven by slowing fuel volumes, with the ONS saying that some retailers were conserving fuel after a big rise in sales during March. 

Excluding fuel, retail sales dropped by 0.4% month on month. Both clothing and online retail was down, which retailers “attributed to variable weather and lower demand”. The first half of April featured a lot wet weather before conditions settled later in the month.

Grocers bucked the retail sales trend with a 0.9% increase in food sale volumes in April. 

“We are starting to see signs that concerns over the Middle East conflict and its impact on living costs are leading shoppers to rein in their spending in many areas,” said Harvir Dhillon, economist at the British Retail Consortium.

April also coincided with a two-year low of -25 in consumer confidence, according to the latest GfK tracker. Figures released this morning showed a slight increase to -23, putting the current consumer mood about where it was in April 2025 when bill rises and tariffs coincided with a sharp drop in the public mood. 

Worryingly for retailers, GfK reported a drop in major purchase intentions, with that element of the tracker hitting its lowest levels since the start of last year. 

“Inflation may have fallen in April, but with price pressures expected to rise again and continued uncertainty around interest rates, it is unlikely May marks the beginning of a sustained improvement,” said Neil Bellamy, consumer insights director at GfK.

“April 2026 will be remembered as the first month that the impact of the Middle East conflict first hit British consumers. We already saw consumer sentiment fall at its fastest rate for four years, and we now have evidence that this translated into shoppers buying less in stores,” said Jacqueline Windsor, head of retail at PwC UK.

“Overall, while retailers will be disappointed, April’s performance was somewhat expected after a better than expected March, and against strong comparatives from this time last year.”