British retail sales drop in February

24th March 2011, Comments 0 comments

Retail sales in Britain dropped 0.8 percent in February from January, when they had recorded a strong rise, official data showed on Thursday.

Analysts had forecast a slightly smaller drop of 0.7 percent in February, according to a poll by Dow Jones Newswires. Retail sales had jumped 1.9 percent in January.

Retail sales meanwhile increased by 1.3 percent in February compared with 12 months earlier, the Office for National Statistics (ONS) said. That compared with expectations for a rise of 2.1 percent.

"Between January and February, total sales volume decreased by 0.8 percent," the ONS said in a statement.

"Both predominantly food stores and predominantly non-food stores decreased with falls of 0.4 percent and 1.6 percent respectively."

Analysts said the latest data dealt a blow to government hopes of kick-starting growth of Britain's economy, which shrank in the final quarter of 2010.

"Given that consumer spending accounts for some 65 percent of (British) GDP, any sustained weakening in spending would be very worrying for overall growth prospects," said Howard Archer, chief European economist at research group IHS Global Insight.

The data comes a day after the coalition government slashed its 2011 forecast for British gross domestic product (GDP) growth to 1.7 percent from a previous estimate of 2.1 percent.

© 2011 AFP

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