UK retail sales values up slightly in September
Tuesday, 11 October 2011 10:53
UK retail sales values picked up slightly in September compared with a year earlier, but underlying economic conditions remain weak, a report has suggested.
The British Retail Consortium's (BRC) latest retail sales monitor study revealed a 0.3 per cent increase on last year in terms of value on a like-for-like basis.
However, clothing sales dropped sharply in the heatwave that occurred at the end of the four weeks, while internet, mail-order and phone order growth fell back after picking up in August.
Non-food sales improved a little over the month, but remained "challenging", the data showed, while homewares also experienced a modest increase, although much of this was deal-driven.
Larger purchases were curbed as a result of fragile consumer confidence and the weak state of the property market.
Stephen Robertson, BRC director general said retailers should be "thankful" for the modest improvement in the currently harsh conditions, "but underlying conditions remain weak".
He added: "Spending growth is below inflation meaning customers are buying less than this time last year. And there's no guarantee next month's figure will be better."
Chief UK economist at IHS Global Insight Dr Howard Archer said inflation and VAT accounted for the rise in sales value compared with last year.
"It is hard to be optimistic over the prospects for consumer spending in the near term at least," he continued. "Consumer confidence is very low, with purchasing power under severe pressure from high inflation, muted wage growth and tighter fiscal policy.
"The only really good news for consumers is that it is very clear that the Bank of England is not going to raise interest rates for some considerable time to come," Dr Archer concluded.
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