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Retail sales rise more than expected

Retail sales rise more than expected

Category: Economy

Updated: 17/06/2010
First Published: 17/06/2010

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
Retail sales defied expectations in May, as the build up to the World Cup saw cash registers ring up and down the country.

A mere rise of 0.1% in retail sales had been predicted, but the Office for National Statistics (ONS) has reported that sales volumes actually grew by 0.6%, compared with April.

The marked rise in sales has been driven by a 1.6% increase in household goods sales and a 1% jump in the sales of food, as people stocked up on new televisions and provisions for the tournament.

It is hoped that a good performance from the England team could help boost GDP figures for the second quarter of the year.

Duncan Higgins of Caxton FX said that the upward trend would be likely to continue into next month as the effects of the World Cup continue, but that increases are unlikely to be maintained over the following period.

"We will see a strong figure for June as the World Cup effect continues through, but past that, the tax increases are likely to put a cap on consumer spending, he added.

"It is hard to see the economic picture improving over the medium term with consumers and businesses alike facing a lot of pressure."

Annually, sales volumes increased by 2.2% compared with one year ago, and by 4.4% in terms of value.

However, the ONS did reveal that sales did not rise by 0.3% in April as had previously been thought, but, instead, actually remained the same from March.

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