UK retail sales picked up in March, but analysts and economists said this was helped by the timing of Easter and underlying demand remains weak and is set to soften in the coming months.
Data from the BRC-KPMG Retail Sales Monitor showed total sales rose 3.6% year-on-year, with food up 6.8% and non-food increasing just 0.9%.
The uplift was largely driven by grocery spending over the Easter period, with shoppers favouring essentials over discretionary purchases. Online non-food sales were broadly flat, while store sales benefited from stronger footfall.
Analysts cautioned that the improvement overstates the health of the sector.
Pantheon Macroeconomics said they would take year-over-year growth "with a pinch of salt", noting that calendar effects flattered the figures and that “we expect a drop in sales in April”.
The early Easter distorted comparisons, with similar patterns seen previously when March strength was followed by a sharp April decline.
Broker Shore Capital said the outlook for UK consumers remains fragile, pointing to rising energy costs, geopolitical tensions and persistent inflation pressures.
Food inflation is now expected to accelerate through the year, potentially reaching around 6% mid-year, though the broker said this will "support trading activity and earnings in this sector".
Food inflation is acknowledged as a boon to grocery groups as they are able to pass on increased costs to consumers.
While grocery retailers are seen as relatively resilient, discretionary categories such as clothing remain under pressure, with tough weather-related comparisons likely to weigh on trading into the summer months.
"April to July comprises tough weather-related trading comparatives for clothing and food, in particular, whilst we also see food inflation in Britain progressively appreciating in the spring/summer months, its duration and ultimate extent being dependent upon matters surrounding Iran," said Shore Capital.
More broadly, the UK consumer economy faces a real "hangover from Iran", with fuel and other raised costs meaning inflation will be higher for longer "and probably Bank of England base rates too, which we suspect will remain at current levels through much of the year".
Accordingly, having at the start of the year hoped for moderately improving real UK living standards, this now "looks a bit of a stretch".