Retail sales rose by 1.7 per cent in February compared to January as the retail industry showed good signs of recovery say official figures.
The figures surpassed analyst’s expectations of +0.5 per cent for the month.
Consumers spent 3.5 per cent more in February year-on-year as a booming housing market drove sales of furniture and DIY products. But the six per cent fall in petrol prices – driven by supermarkets decision to cut fuel prices – offset further growth. Retail sales growth in food - the largest retail category - rose 1.6 per cent which now accounts for 42p of every pound spent in retail.
“Retailers will look to the arrival of spring as a further opportunity to maintain positive momentum,” commented Keith Richardson, Managing Director, Retail Sector at Lloyds Bank Commercial Banking. “Price cuts particularly in the grocery sector, will benefit consumers in future months, although this will impact upon margins for both retailers and their suppliers.”
Internet sales rose 12.4 per cent year-on-year to account for over one in ten of total retail spend as department store and online grocery sales drove growth.
Michael Lane, Channel and Product Director at Secure Trading said it was no surprise that online sales were booming but warned that many websites are collapsing under the pressure of larger volumes of traffic. “This continued increase in online spending should encourage retailers to capitalise on the growing trend and ensure they invest in the best possible framework in order to process large numbers of payments,” he said.
In a separate CBI survey, retail sales rose strongly with 9 per cent of retailers surveyed stated sales volumes were “above average” for the time of year.