Retail Sales Growth Gives Boost For Economy

Shoppers delivered a much-needed boost to the economy last month as retail sales grew by a better-than-expected 1.3%, according to official figures.

The month-on-month improvement was well above the 0.5% figure pencilled in by analysts and comes amid gloom in other sectors such as industrial production and construction and after a first quarter slowdown in overall gross domestic product (GDP) growth.

However, cold weather over the spring left fashion sales under pressure – although discounting helped to shore up trade.

Figures from the Office for National Statistics (ONS) also revised the retail sector's performance in March, to show it did not decline as much as previously thought.

Consumer spending has been a major driver of Britain's economic expansion but there have been signs of faltering confidence in recent months.

Ben Brettell, senior economist at Hargreaves Lansdown (LSE: HL.L - news) , said: "The UK economy's glass was beginning to look decidedly half-empty, so today's retail sales figures are a welcome tonic to the gloomy economic mood."

Vicky Redwood, chief UK economist, said: "Consumer spending should prevent the economy from slowing too much this quarter, even if referendum uncertainty has a bigger impact on business confidence and investment."

Ian Geddes, head of retail at Deloitte, said the retail and leisure industry would now be looking ahead for a summer "feelgood" boost with the Queen's 90th birthday celebrations, the Olympics and the European football championships coming.