26/08/2010
Retail sales in July rose at the fastest pace since February, defying the gloomy forecasts of many City analysts.
Citing Office for National Statistics (ONS) figures released earlier today, The Guardian reports that sales grew 1.1% in July compared to June. City experts had previously predicted sales growth to slow from 0.7 per cent to 0.4 per cent on June's figures.
Small businesses and specialist retailers enjoyed a 6.1% jump in sales, with computer retailers, jewellers, sports shops and book stores particularly thriving. The Guardian added that mail order sales have also performed well, with growth of 4.3 per cent.
The better-than-expected retail figures are extremely encouraging, and could be a sign that consumer confidence is starting to improve. This in turn could lead to a renewed increase in borrowing, with small businesses in particular able to benefit from commercial finance services such as invoice discounting and factoring.
After the bumpy ride that consumers have endured over the past couple of years, City experts could perhaps be forgiven for their cautious forecasts. However, the ONS figures published today have provided the retail sector with a timely boost.
"The key message is that the consumer is not dead," Yahoo!
Finance quoted one industry expert as saying.
"Consumers are still in a spot where they've been enjoying low interest rates and a pickup in the economy," another leading economist told Bloomberg.
Joseph Jeffries