Strong UK high street sales surprise analysts
ONS data shows retail sales have increased at fastest rate since April 2011.
High street sales rose in January, up 0.9 per cent compared to December 2011, according to figures released by the Office of National Statistics this morning.
The monthly numbers, which caught analysts by surprise, also meant that the value of retail sales in January 2012 were 4.4 per cent up on the previous January while sales volumes were up 2.0 per cent across the same time period.
Retail analysts had predicted a monthly decline of 0.4 per cent. Richard Driver, a currency analyst for Caxton FX, described the January figures as "staggeringly strong". It is the first time in eight years that sales have risen between December and January. The news comes a day after a survey from the Nationwide showed consumer confidence at its highest level for five months.
Heavily discounted goods enticed customers to spend despite most consumers suffering a squeeze on their living standards.
On the back of December's strong retail sales growth, this represents an excellent start to the year. The growth is not really down to January high street discounts - non-store/online sales look to have been the key performers. There was a minor clue from the improved UK consumer confidence figure earlier in the week, however, high street sentiment remains at historically very low levels and nobody saw this coming.
However, David Kern, chief economist at the British Chambers of Commerce, added a note of caution. "We mustn't shrug off the serious challenges facing the UK economy, particularly while tough fiscal measures are being implemented by the government, and the problems in the eurozone remain," he said.
The UK economy declined by 0.2 per cent in the three months to December 2011.