The volume of retail sales in September 2012: up 0.6% on the month, up 2.5% on the year
Annual store price inflation rose to 0.7%
Commenting on the retail sales figures for September, published today by the ONS, David Kern, Chief Economist at the British Chambers of Commerce (BCC), said:
“The retail sales figures for August are stronger than expected, increasing by 0.6% after a dip in August. High street inflation rose slightly but remains at a relatively low level of 0.7%. Low store price inflation supports consumer spending, at a time when the UK economy is stagnant. The latest retail sales figures may point towards a return to positive growth, with the first estimate of GDP for Q3 expected next week.
“However, since consumer price inflation is likely to rise over the next month, the slight increase in store price inflation seen in September is concerning. Falling inflation benefits the UK economy as it reduces the squeeze on businesses and consumers and underpins domestic demand at a time of fiscal austerity, and problems in the global economy.
Unless inflation falls further, the UK economy could face more obstacles. Further increases in Quantitative Easing (QE) could reverse the trend of falling inflation, so we urge the Bank of England to maintain the asset purchase programme at £375bn. The government must take action to secure a sustainable recovery by empowering private sector businesses to create jobs, invest and export.”