Clothes push retail sales up 0.3pc in April

IMPROVING clothing and department store sales offset flat food sales to push British retail revenues slightly higher than expected in April, according to the Office for National Statistics.

Including petrol and diesel, high street sales rose 0.3 per cent last month, above analysts’ forecasts of 0.2 per cent and up 1.8 per cent year-on-year. The figures indicate consumers across the country are emerging from the deepest recession since the Second World War with a robust appetite for spending.

City observers said retail sales figures were becoming more reliable now the influence of January’s VAT hike and the unusually cold winter weather had passed.

Alan Clarke of BNP Paribas said: “As a series it’s looking pretty respectable. However, if we get a strong fiscal tightening the rate of growth may not last until the end of the year.”

Howard Archer of IHS Global Insight added: “The consumer is alive but not kicking particularly hard. Indeed, we suspect that the upside for consumer spending – and hence economic growth – will be limited for some time to come as households still face very challenging conditions.”

Following the recent rise in the price of an average basket of goods to 3.7 per cent, the retail sales deflator – a measure of inflation – rose to 2.8 per cent on the year from 2.5 per cent.

But the minutes of the Bank of England’s meeting in May, released on Wednesday, showed the Monetary Policy Committee was more concerned with the prospect of weak growth than inflation.

● Against expectations, the luxury end of the high street has held up well. Alliance Boots notched up its first £1bn profit this week.

● Supermarkets continue to suffer. Asda recently reported its first sales fall in four years.