Retail sales for August smash expectations and boost pound

Cornelia Mascio
Settembre 20, 2017

The Office for National Statistics (ONS) also said that compared with last August, sales volumes were 2.4% higher.

Ahead of the data, the pound showed mixed trading against its major rivals.

"Within this month's retail sales we are seeing strong price increases across all store types compared with a year ago, reflecting wider inflationary pressures", Kate Davies, a senior statistician at the ONS, said.

The pound, which had traded at around 1.3507 prior to the data release, spiked almost 0.7% to 1.3603 as traders increased bets that the faster pace of sales could close the case for BoE rate hikes.

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"Not only did retail sales volumes rise by a hefty 1pc on the month in August - exceeding consensus expectations of a 0.2pc rise - but growth in the previous month was revised up from 0.3pc to 0.6pc too". Sales have increased for the 52nd consecutive month. So-called core inflation, which strips out volatile prices for food and energy, rose to 2.7%, the ONS said, the highest since 2011.

The ONS said: "Year-on-year contribution of food stores remains flat, while there was a fall in the contribution of growth within petrol stations, showing that contributions to the overall growth came from non-essential items".

"Despite the price increases in clothing stores, likely to be as a result of sales promotions ending, consumers continued to buy more from these stores and feedback from businesses suggests that footwear stores fared well with back-to-school items this August".

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