Why did UK retail sales surge in April 2025? Weather and easter spending explained

UK retail sales volumes rose sharply by 1.2% in April 2025, marking the fourth straight month of growth and beating market expectations of a 0.2% increase, according to the Office for National Statistics (ONS). This unexpected upside was largely attributed to warmer weather and the Easter holiday season, both of which encouraged consumer spending across food, beverage, and garden-related categories.

The data adds to mounting evidence that the UK consumer economy—while still navigating cost-of-living pressures—is demonstrating pockets of resilience. It follows a 0.9% rise in March 2025 and extends a positive momentum that began at the start of the calendar year. Over the three months to April, retail volumes grew 1.8%, the fastest rolling quarterly expansion since mid-2021, when post-pandemic reopening tailwinds had briefly ignited demand.

This rebound is notable against a backdrop of inflationary stickiness, lingering uncertainty around wage growth, and continued structural transformation in UK retail, where online vs offline dynamics are evolving rapidly.

What Sectors Drove the April Retail Upswing?

The strongest driver of April’s upside came from food retail. Sales volumes in food stores grew 3.9% month-on-month—outpacing all other segments—after falling for two consecutive months. Supermarkets cited increased demand for seasonal goods ahead of the Easter long weekend, while warmer weather conditions reportedly encouraged higher in-store footfall and impulse purchases.

Large retail chains like Tesco PLC and J Sainsbury plc noted stronger-than-usual volumes in barbecue items, beverages, and fresh produce. While not yet quantified at the earnings level, analysts at Barclays flagged April’s performance as “materially ahead of internal models,” citing weather-related variables and calendar effects as catalysts.

Non-food stores, however, posted a 0.7% decline, with clothing, footwear, and household goods retailers reporting softer volumes. These figures represent a slight pullback from March, when many retailers had experienced a brief uplift in spring-season apparel and home furnishings.

Meanwhile, automotive fuel sales dipped 0.3%, contributing little to the monthly change. This comes as oil prices stabilised in April and pump prices remained broadly flat, reducing incentive-based fuel spending.

How Did Online Retail and Digital Channels Perform?

Despite the broader retail uptick, online sales declined 0.3% in April compared to March. However, year-on-year online sales values still remained 6.1% higher than April 2024. Digital retail now accounts for 25.7% of total UK retail spending—a significant share, but below the pandemic peak of nearly 35%.

Pure-play e-commerce firms like ASOS PLC and Boohoo Group plc continue to report margin compression amid higher return rates and persistent delivery costs. Analysts from Peel Hunt reiterated their cautious stance on online-only models, flagging the comparative advantage now shifting back toward omnichannel retailers who benefit from in-store experience-driven purchasing during favorable weather periods.

What Is the Investor and Market Reaction?

Equity market reaction to the retail data has been broadly positive. On the day following the ONS release, the FTSE 350 Retail Index rose 0.9%, with traditional brick-and-mortar leaders seeing modest gains.

Next plc, which had already reported an 11.4% increase in full-price sales for the 13 weeks to April 26, received additional investor tailwinds following confirmation of the broader retail sector’s health. Marks and Spencer Group plc also saw increased institutional buying, aided by optimism surrounding its ongoing transformation strategy. Its general merchandise unit—particularly food and clothing—was seen as a likely beneficiary of April’s favorable footfall trends.

However, discretionary and fashion-oriented stocks remained under mixed sentiment. While Frasers Group PLC held steady, discount-driven names like Primark (under Associated British Foods) showed limited upward movement, with traders cautious about pricing power erosion heading into Q2.

What Is the Broader Economic Context Behind April’s Retail Rebound?

The UK retail revival occurs amid a complex macroeconomic transition. Inflation in April ticked up marginally to 3.5% from 3.2% in March, largely due to energy base effects and services inflation. At the same time, wage growth remains robust, averaging 5.6% across the private sector. These dynamics suggest that real income growth may be stabilising, albeit unevenly across households.

Consumer confidence, as measured by GfK’s monthly index, edged up for the third consecutive month in May, reflecting improved sentiment among households regarding their personal finances and broader economic prospects. Economists at Pantheon Macroeconomics noted that the combination of lower utility bills, stable mortgage rates, and strong labour market data has bolstered short-term spending appetite.

Yet, this sentiment is tempered by structural concerns. New business rate increases, a 10% hike in the national minimum wage from April, and tightening food safety and environmental compliance rules have all contributed to margin pressures, particularly for small and mid-sized retailers.

Will April’s Momentum Continue Into the Summer?

Looking ahead, many analysts view the April retail boost as partly seasonal and calendar-driven. Easter occurred earlier this year, front-loading certain categories of consumption. The warmest April in the UK since 2011 also contributed to short-term discretionary spending that may not be sustained in less favorable conditions.

Still, the three-month rolling average signals improving consumer momentum. Analysts at HSBC revised their Q2 GDP growth forecast from 0.1% to 0.3%, factoring in the strength of April consumption data and early May mobility trends. Some retailers may further benefit from early summer events like the UEFA Euro 2025 and summer travel season, both of which historically lift grocery and beverage sales.

In parallel, supply chain bottlenecks seen in late 2024 have now largely normalised, allowing better inventory management and faster delivery cycles—advantages that should benefit firms with agile digital infrastructure.

Strategic Outlook: Who Stands to Gain or Lose?

Retailers with diversified seasonal portfolios—like Marks and Spencer Group plc and Next plc—are poised to extend their gains into Q2, especially if May and June maintain moderate weather and holiday-driven footfall. Grocers with private-label strength may also capture more volume if food price inflation continues to cool.

Conversely, firms heavily exposed to discount fashion or reliant on high promotional activity may struggle to defend margins in a higher-wage, high-cost operating environment. Fast fashion retailers, already battling inventory overhang and weak demand elasticity, could see continued volatility in their quarterly performance.

Digital-native brands will need to sharpen their mobile engagement strategies and reduce operational bloat to retain relevance as hybrid shopping models regain strength.

Institutional sentiment toward UK consumer stocks has improved moderately post-release. Buy-side flows indicate selective optimism, with increased fund exposure to top-tier retail names. Sector ETFs saw net inflows, while bond markets remained largely unmoved, suggesting that investors view April’s data as a tactical rather than structural pivot.