UK DATA: BRC Retail Sales See Strong Start to 2026, Especially Non-food Sales

BRC retail sales jumped to 2.7% Y/Y in January (1.2% Dec), the strongest since last August, and ending a run of four consecutive slowdowns in the Y/Y rate. Retail sales saw broad-based growth, with both food and non-food sales growing notably.

• Although we have consistently noted high food inflation driving the headline rate here, the picture for January is more mixed with both food and non-food (where inflation is not as high) sales jumping significantly compared to last year.
• Food sales accelerated further to 3.8% Y/Y (3.1% Dec), now at the highest rate since last August, though the BRC notes that "shopper confidence was muted in January, primarily driven by concerns about future price rises ... The outlook for 2026 indicates that food inflation will persist for some time." This is in contrast to intelligence from the BOE's Agents which suggest that food inflation has peaked.
• Non-food sales jumped notably to 1.7% Y/Y (-0.3% Dec), also the strongest since last August, following a one-month dip into negative territory in December. The press release notes that "January sales enticed consumers to spend, with personal electronics, furniture, and children's clothes and toys, all among the best performing categories."
• The strength in this month's data can be taken as a continuation of new year driven activity, after December's BRC report highlighted a notable pick-up in sales towards the end of the survey period (up to 3rd Jan), despite the overall weak print.
• The ONS's retail sales volume index will see January data released on 20 February, after December saw a decent upside surprise of 0.4% M/M (0.3% M/M ex-fuels, 0.0% cons for both) - though the ONS noted that this was boosted by precious metals demand - so it's not necessarily an underlying beat.
• Today's BRC release covers the same four weeks as the upcoming ONS report (4 - 31 January 2026). We are always cautious about translating the BRC's value index Y/Y rates into implications for the ONS release, though the January bounce seen here does look particularly strong.