The FINANCIAL — U.K. retail sales surged ahead of the Christmas season, official figures showed on December 17, lifting hopes of a bumper final quarter of the year, according to Nasdaq.
British retailers sold 1.7% more in volume terms in November, the Office for National Statistics said, a powerful 5% increase year-on-year. This was much above forecasts by economists polled by The Wall Street Journal last week, who were expecting only a muted recovery after an October lull.
This is welcome news for Britain, which is increasingly dependent on its consumers and its powerhouse services sector to fuel economic growth, dispelling earlier concerns of a slowdown in activity. Economic growth in the final quarter of the year will be starkly dependent on the strength of the Christmas season, analysts say, as weak trade and a beleaguered industrial sector continue to drag on activity.
In fact, business and consumer surveys for November had been rather gloomy, leading analysts to worry about a lackluster fourth quarter. Furthermore, official statistics showed Wednesday that pay for British workers is rising at a slower pace than it did earlier in the year, which is usually expected to drive households to act more cautiously and spend less on gifts.
However, early polls had already penciled in a surge in online sales, a sign consumers had chosen to plan their purchases ahead rather than putting them off. This was confirmed by Thursday’s figures, which showed a 13.2% rise in non-store sales, much of which is accounted by mail order houses, including Internet retailers.