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Last Updated: Tuesday, 8 August 2006, 14:24 GMT 15:24 UK
Heatwave sparks retail sales rise
People queueing at ice cream van in London
The hot weather made outdoor eating more enticing, says the BRC
Hot weather in July helped heat up retail sales, figures from the British Retail Consortium (BRC) show.

Like-for-like sales rose 3.4% in July, ahead of the 2.3% growth posted in June. Overall sales grew 6.1%.

Food and drink sales grew at their strongest rate since 2003 amid the recent heatwave, which made picnics and barbecues a popular option.

But homewares and indoor product sales suffered, as the hot weather left consumers reluctant to visit the shops.

"The exceptionally hot weather hit footfall but benefited food, drink and outdoor living," the industry group said.

Experts added that July 2006 sales may also have been flattered by the comparison with last year's figures, which were weakened by the after-effects of the 7 July London bombings.

The BRC also warned that the trend for growth may be curtailed by the Bank of England's recent decision to raise interest rates to 4.75%.

"Talk of a general upturn in consumer spending is wide of the mark - even more so since the Monetary Policy Committee increased interest rates," said BRC director general Kevin Hawkins.

Experts have voiced fears that as rising oil prices and utility bills begin to bite, UK consumers may opt to rein in their spending.

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