British retail sales rose six times faster than expected on the month in May as consumers flocked to electrical goods stores ahead of the World Cup soccer tournament, official data showed today.
The Office for National Statistics said sales volumes including automotive fuel rose 0.6 per cent last month and 2.2 per cent on the year. Analysts had forecast a rise of 0.1 percent on the year for an annual rise of 2.0 per cent.
Excluding fuel, retail sales were 0.5 per cent higher on the month and were up 3.4 per cent on the year.
Sterling rose against the dollar and the euro after the stronger-than-expected figures.
The ONS said there was no growth in retail sales on the month in April, revising down its initial reading of 0.3 per cent. However, underlying growth picked up in May. The three-month on three-month rolling rate rose to 1.0 per cent from a flat reading in April - its strongest since October 2009.
The figures suggest that consumer spending could give a boost to second quarter economic growth, although the outlook remains uncertain given recent falls in consumer confidence and the prospect of severe government spending cuts.
The ONS said sales at household goods stores rose 1.7 per cent on the month, with electrical goods performing strongly.
Sales of televisions are likely to have helped the month's figures, the ONS indicated, as soccer-mad Britons splashed out on the latest technology before the World Cup kicked off in South Africa this month.
Food stores booked their biggest monthly rise in sales since June 2009. This week, supermarket chain Sainsbury's said sales excluding fuel at stores open at least a year rose 1.1 per cent in the 12 weeks to June 12.
Sales of clothing and footwear, however, suffered their worst month since November 2009.
The price deflator, which measures how much retailers are hiking prices, eased to 2.3 per cent on the year in May from 2.9 per cent in April. That fall suggests price pressures are easing on the high street in line with headline consumer price inflation data earlier this week and should provide some reassurance to the Bank of England which expected inflation to subside this year.
REUTERS