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Retail sales increase by 1.8%

Retail sales increased by 1.8% on March, the biggest monthly rise in a year.

The Office of National Statistics attributed the rise to the warm weather last month, which helped to boost sales of clothing, footwear and gardening products.

Commenting on the figures, Richard Driver, analyst for Caxton FX said: “ The 1.8% UK retail sales figure for March really is staggeringly good, the strongest showing in over a year. What’s great is that even excluding auto fuels, retail sales grew by 1.5%.

“The premature warm weather will be responsible to a large degree as it will have triggered clothing and gardening purchases.

“The retail sales figure should put fears of a return to technical recession more or less to bed.”

In light of February’s retail contraction, the sector still saw robust growth in Q1, 0.8% up from Q4 of 2011.

He added: “As ever, weak consumer confidence, high unemployment, high oil prices and the constant wave of government austerity highlight the ongoing risks to consumer spending, but good news is good news.

Paul Feechan, consumer business partner for Deloitte North East believes that festivities later this summer could result in a further upturn, but did not anticipate any changes in consumer preferences in the short term.

He said: “Behavioural changes which took hold in 2008, such as buying cheaper brands and products, are now deeply ingrained and with economic recovery still fragile, consumers are not in a position financially or psychologically to reverse these changes and spend heavily.

“The Golden Jubilee and Olympic Games may provide further boosts to consumer spending this summer but while the are some grounds for optimism, we are still some way from calling a sustained recovery in the consumer economy.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .