England World Cup success boosts UK economy

It’s not always the case that Britain finds itself in the midst of a heatwave and it’s almost as unusual to find the England soccer team in the latter stages of a major tournament.

Both have aligned at this summer’s World Cup in Russia and the efforts of Harry Kane and Gareth Southgate have already seen a boost to the U.K. economy.

Sales of beer, barbecues and big screen TVs have been on the up during the month of June as fans have seen an England side have its best performance since 1990. In June, U.K. retail sales increased by 1.1 percent on a like-for-like basis from June 2017, when they had increased 1.2 percent from the preceding year.

The value of total retail sales rose by 2.3 percent compared with June 2017, the British Retail Consortium (BRC) said Tuesday.

That was the joint second-biggest increase of 2018 after a winter slowdown, but was weaker than a 4.1 percent jump in May as the excitement around England’s progress in the World Cup boosted sales only for specific goods.

“The reality is that sales don’t grow on the feel-good factor alone,” Helen Dickinson, the BRC’s chief executive, said in a statement. “With household incomes still barely growing faster than inflation, conditions for consumers and retailers remain extremely tough.”

The percentage jump is in line with the forecast put forward by consumer information firm GFK before the World Cup kicked off. It indicated that 814,000 TVs will be sold in the U.K. over May and June — an increase of over 20 percent during the same months last year.

However, there is a warning that these spending trends may be isolated and potentially short lived. “Things could get tougher: Once the euphoria of sporting success subsides, without a deal on Brexit, shoppers face the prospect of significant price increases and shortages of everyday goods. Even if England do go all the way, households may have little to celebrate come next April.” Dickinson added.

Separate data compiled by credit card provider Barclaycard said its measure of consumer spending — which includes bars and restaurants — rose by 5.1 percent, matching May’s increase which was the strongest in over a year.

During June, when all of the World Cup group stages took place, spending in pubs and restaurants jumped by nearly 10 percent Barclaycard said, but supermarket spending edged up only 0.8 percent, its weakest growth in 15 months. That slowdown might reflect the impact of a 9.3 percent surge in spending on fuel on the back of higher global oil prices.

Shoppers in Britain remained cautious with four in 10 saying they will hold off on buying big-ticket items until the economy seems more settled, Barclaycard said.

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