UK retail sales surged the most in more than two years in January, boosted by demand for clothing and computers.
The 2.3 per cent jump in the volume of sales was almost three times the pace of growth forecast by economists in a Bloomberg survey. The Office for National Statistics said post-Christmas price cutting helped, as retailers looked to clear excess stock.
The increase more than reverses the drop in sales in December, when mild weather curbed purchases of clothing. It also reinforces the picture of an economy being largely driven by domestic demand as UK inflation close to zero and low unemployment boost consumer spending.
"This is a major boost to first-quarter GDP growth prospects," said Howard Archer, an economist at IHS in London. "However, it will be tempered by concern that the UK economy remains unbalanced and too dependent on consumer spending and the services sector."
Measured by the retail deflator, prices fell an annual 2.6 per cent in January, a 19th straight decline, Friday’s data from the ONS showed.
From a year earlier, retail sales including auto fuel, rose 5.2 per cent in January, the ONS said. On the month, food sales increased 1.1 per cent and clothing and footwear sales were up 3.3 per cent. In the last three months, total sales climbed 1.4 per cent, a 26th consecutive increase.
News by Bloomberg, edited by ESM. To subscribe to ESM: The European Supermarket Magazine, click here.
