Clothing sales boost retail sector

Shoppers buying warmer clothing and back-to-school attire helped the wider retail sector enjoy a better-than-expected bounce-back to sales growth last month, official figures revealed today.

Retail sales volumes rose 0.6% in September, following an upwardly revised 0.1% fall in August, the Office for National Statistics (ONS) said. City experts had predicted a 0.4% increase.

There was some hope for the wider economy's prospects as well after retail sales across the third quarter as a whole grew at the fastest rate since June 2010.

The retail sector has endured a tough year with the likes of clothing retailers JJB Sports and Peacocks, outdoor specialist Blacks Leisure, Clinton Cards and Game Group all going into administration.

The figures echo surveys from the British Retail Consortium and CBI, which also revealed a bounce-back to growth last month.

Samuel Tombs, UK economist at Capital Economics, said: "September's rise in the official measure of UK retail sales volumes suggests that consumers loosened their purse strings a little, albeit partly due to temporary factors."

The autumnal weather was behind a 2% month-on-month rise in clothing sales, while the release of the eagerly anticipated iPhone 5 appears to have provided a boost as sales volumes of computer and telecoms equipment were up 7.6%.

Meanwhile, household goods stores had a strong month, with sales growing 1.1%.

However, food stores saw sales drop 0.2% on the month, while department stores saw weaker growth than the wider sector as sales advanced 0.4%.

The average weekly spend across all retailing in September was around £6.6 billion, compared with £6.5 billion in August and £6.4 billion in September 2011.

The average weekly online spend in September was estimated to be £507.8 million, which was an increase of 9.4% when compared with last year.

The amount spent online was estimated to account for 8.8% of all retail spending excluding automotive fuel, while spending online accounts for 63% of total spending, up from 62.9%.

Total economic growth will fall under the spotlight next week as official gross domestic product (GDP) figures are released for the third quarter between July and September.

Howard Archer, chief UK and European economist at IHS Global Insight, said the retail figures supported hopes for a return to growth in the third quarter.

However, he added: "There are still significant pressures facing consumers, which is likely to limit the upside for spending for the time being.

"Consumer price inflation seems likely to rise back up in the near term due to rising utility bills, elevated petrol prices and the threat of higher food prices. Meanwhile, wage growth is only creeping up and is still muted."

PA