Retail sales weaker than expected in November
December 20, 2012 8:42 PM EST
Retail sales failed to grow in November, despite a boost from sales of tablet computers, making it unlikely consumers will give the economy a helping hand in the final quarter.
Retail sales volumes were flat on the month to give an annual rise of just 0.9 percent - below economists' forecasts for both monthly and annual sales growth, the Office for National Statistics said on Thursday.
The figures, which follow a shock fall in retail sales in October, increase the chance that Britain's economy will contract in the last three months of 2012, something the Bank of England has said is likely.
The one bright spot was sales in household goods stores - which includes consumer electricals such as Apple's newly launched iPad Mini tablet computer - which rose by 3.8 percent on the month, the biggest jump since February 2010.
Consumer spending, which drives about two thirds of British GDP, has still not recovered to the levels seen before the 2008-09 recession, as stubborn inflation has outpaced pay growth.
A number of well-known British high-street stores have ceased trading this year, including JJB Sports, Clinton Cards and Game Group. The latest failure, 235-store electrical chain Comet, shut its doors on Tuesday.
And according to a survey by the Confederation of British Industry, the key Christmas trading period got off to a weak start, with retail sales growing less than expected in the first half of December.
However, some retailers are bucking the trend.
John Lewis, Britain's biggest department-store group, reported record weekly sales for a second straight week.
The ONS said retail sales excluding fuel rose 0.1 percent on the month and were 2.0 percent higher than in November 2011, compared to economists' forecast for a 0.4 percent increase on the month and a 2.3 percent rise on the year.
Automotive fuel sales themselves were 8.8 percent lower than a year earlier, the biggest decline since October 2010.
British inflation held at 2.7 percent in November, the highest rate since May and well above pay growth, which averaged less than 2 percent in the three months through October.
Rising food prices was a major source of high inflation in November, and Thursday's data showed that food sales volumes dropped 0.1 percent on the month, partly as a result.
The pressure on Britons' incomes is unlikely to ease anytime soon, as the Bank policymakers said on Wednesday that inflation would probably exceed 2 percent in the next year, with further upward risks from higher food prices.
(Reporting by Olesya Dmitracova and David Milliken)
Most Popular Slideshows
Join the Conversation
- Tourre on stand says email in SEC case 'not accurate'
- Syrian authorities blocking access to needy in Homs - Red Cross
- Faith in European Union at low ebb, EU poll says
- Former UBS banker gets 18 months, $1 million fine, for muni bid-rigging scheme
- U.S. judge halts challenges to Detroit's bankruptcy bid
- Chilling: New ISIS Video Addresses Australia; Aussie Teen Delivers Message
- The Pirate Bay Blockade: Cost Of Blocking Websites Like TPB Is Ridiculously High
- Xiaomi Mi4 And MiPad Prices Likely Slashed, Thanks To Rivals Oppo, OnePlus And Meizu
- Virginia Woman Who Posted Naked Image Of Ex-BF’s New Partner 1st Person Charged Under Revenge Porn Law
- No Mercy: ISIS, Father Stones to Death Daughter for Alleged Adultery
- Meizu MX4 Pro To Arrive In November In Black And White Colours, Features Higher Than QHD Display, Exynos 5430 SoC And 3 GB RAM
- iOS 8 Jailbreak Release Date is Doomed as Team Evad3rs Opts Out, Pangu Hits Snag – Report