Surprise increase in retail sales

Dec 18 2008

Retail sales figures have revealed an unexpected 0.3% rise between October and November as official data continued to defy high street trading woes.

Economists had been forecasting a fall of 0.4% from Britain's battered retail sector.

The Office for National Statistics (ONS) said the performance was driven by sales of food and household goods, with a year-on-year rise of 1.5% in November.

But the annual rate of sales volumes is the lowest since February 2006, according to the seasonally adjusted ONS data.

And the figures showed the steepest fall in three-month sales within department stores since records began 22 years ago. Sales of non-specialised stores - including department stores - dropped 3.8% in the three months to the end of November compared to a year ago.

The ONS also revised sales volume figures downwards for the previous two months, with a fall of 0.3% in October against the 0.1% previous estimation and a drop of 0.6% in September compared with its initial 0.5% fall.

However, Thursday's data showed that retailers rung up sales worth £5.8 billion a week last month, up 2.9% on last November.

It also highlighted the rise of internet shopping, revealing around £220 million of online sales a week during November - which now represents 3.8% of total retail sales, up from 2.8% in June.

Economist Howard Archer, of IHS Global Insight, said the increase in internet sales helped boost the overall data and provides an explanation of the difference between Thursday's data and recent gloomy high street survey results.

Figures on Wednesday showed that high street sales fell to their weakest for 25 years, according to the latest CBI poll.