Burton Mills - UK Retail Sales Up in February

Taipei, Taiwan, March 27, 2018 (Newswire.com) - ​UK retail sales spiked in February, although Burton Mills economists say concerns persist about the strength of consumer demand as the Bank of England considers when to increase interest rates leading up to Brexit in little over a year.

The Office for National Statistics stated that retail sales increased 0.8 percent in February from the first month of the year. This was higher than predicted by most economists who forecast a monthly increase of 0.4 percent after a decline of 0.2 percent in January.

Burton Mills economists say there is a risk of a further slowdown in March due to the unseasonably cold weather that brought disruption across the UK.

The UK’s economy performed more poorly than its peers in 2017 as elevated inflation caused by a sharp devaluation of the pound after the Brexit referendum placed pressure on consumer spending power.

The Bank of England is to announce its policy decision for this month and anticipates that the squeeze on consumers will ease this year as inflation slows and salary growth picks up.

This week’s figures revealed that retail prices increased last month by 2.5 percent on an annual basis. Burton Mills economists say this was the slowest increase since January last year.

Burton Mills economists believe that the Bank of England will increase interest rates in May for the second time since the financial crisis started 10 years ago.

Official data showed that wage growth accelerated at its fastest annual pace since June of 2015 during the period from November to January.

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Source: Burton Mills