Page last updated at 11:25 GMT, Thursday, 18 December 2008

Surprise rise in UK retail sales

Christmas shoppers recently on London's Oxford Street
The official figures have come as something of a surprise

UK retail sales rose unexpectedly last month, official figures have shown.

Total sales volumes climbed 0.3% in November from the previous month, the Office for National Statistics said. Sales were up 1.5% from a year ago.

Analysts had been expecting sales to fall in November, and recent surveys have suggested trading has been weak.

The rise in monthly sales was led by household goods, which were up 3.9% in November - their biggest monthly increase since July 2007.

Food sales were up 0.2% for the month, while those of clothing and footwear were down 0.1%.

The level of overall retail sales made via the internet was 3.8%, up from 3.2% in October.

'Doesn't tally'

Analysts had been expecting retail sales to fall 0.6% in November.

Some retailers will now dare to breathe a sigh of relief that customers are simply deferring their Christmas spending rather than cancelling it entirely
BRC director general Stephen Robertson

"Early Christmas shopping could explain part of the strength, but it doesn't really tally with the weakness in consumer confidence nor the data seen in the CBI and British Retail Consortium (BRC) surveys," said James Knightley, an economist at ING.

BRC director general Stephen Robertson said the rise in the official figure for November was "hard to explain".

However, he put the increase down to high profile price cuts and promotions, combined with the recent falls in interest rates and VAT.

"Some retailers will now dare to breathe a sigh of relief that customers are simply deferring their Christmas spending rather than cancelling it entirely," he said.

The BRC said last week that total UK retail sales had fallen in consecutive months for the first time in at least 13 years.

It found that sales were November were down 0.4% from a year earlier, following a 0.1% dip in October.

And more timely figures from Experian, which track "footfalls" or the number of people out on the High Street, suggest that the number of shoppers has dropped by 11.5% in the first three days of this week compared to the same period last year.

Meanwhile, official data on Wednesday showed that the number of people out of work in the UK rose by 137,000 to 1.86 million in the three months to October - the highest level since 1997.



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