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UK retail sales rebound in April

Do Not UseDo Not Use 19/05/2016
shoppers Oxford Street © Getty Images shoppers Oxford Street

UK retail sales volumes rose strongly in April despite lower spring clothing sales due to the cold weather, official figures show.

Shopping basket: Food prices are continuing to fall as supermarkets fight for market share © Reuters Food prices are continuing to fall as supermarkets fight for market share

Sales volumes were 1.3% higher in the month compared with March.

They were also 4.3% higher than a year earlier, the Office For National Statistics (ONS) said.

The ONS revised March's retail sales figures, showing retail sales fell by just 0.5% rather than 1.3%, as first estimated.

"Clothing stores remain the main drag on growth in the retail sector, with sales hampered by unseasonal weather. However... sales increased in April compared with March as lower prices boosted sales," said ONS statistician Melanie Richard.

Colder than usual weather had also dented spending in March, hurting demand for spring and summer clothes, according to the ONS and surveys from the British Retail Consortium and the CBI.

The latest ONS figures showed total average store prices in April were 2.8% lower than a year earlier, dragged down by a 7.3% drop in fuel prices. Food store prices fell 2.3% amid the continuing supermarket price war.

However, the total amount spent in April increased by 2.1% to £28.1bn compared with the year before.

Keith Richardson, of Lloyds Bank commercial banking, said a rush to complete property deals before a stamp duty rise came into effect in April had helped to boost demand for household goods and furniture.

Vicky Redwood, chief economist at Capital Economics, said that consumer confidence did not seem to have been adversely affected by the UK's upcoming referendum on EU membership.

"Indeed, consumer spending should prevent the economy from slowing too much this quarter, even if referendum uncertainty has a bigger impact on business confidence and investment," she said.

The British Chambers of Commerce (BCC) said the rise in April's retail sales was welcome, but highlighted imbalances in the UK economy.

"After the disappointing decline in March, the strong retail sales recovery in April supports our view that in spite of major headwinds the UK economy continues to grow, albeit at a slowing pace," said David Kern, BCC chief economist.

"However, the contrast between buoyant retail sales and the problems facing other sectors such as manufacturing highlights the unbalanced nature of Britain's recovery."

The BCC called for "a more balanced economic structure with a stronger focus on exports, investment and manufacturing".

The stronger-than-expected retail sales figures pushed up the value of the pound. Sterling rose against the euro by 0.3% to €1.3053, and climbed 0.2% against the dollar to $1.4625.

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