UK Retailers Get Black Friday Boost as Sales Jump 1.1%

UK Retailers Get Black Friday Boost as Sales Jump 1.1%

Despite the rising inflation and slower wage growth, the retail sales grew by 1.6% year-over-year, compared with a lack of change in October and against a 0.3% forecast.

James Smith, economist at ING Bank, said the better-than -expected monthly figures should be treated with caution while there were few reasons to expect consumer spending to improve heading into 2018 - with wage growth failing to keep pace with inflation and signs of a stuttering jobs market. Those sales will fall into the December data.

Samuel Tombs, chief United Kingdom economist at Pantheon Macroeconomics, said: "The surge in retail sales in November does not signal broader consumer strength".

Nevertheless, the latest figures could provide reassurance to the country's central bank, the Bank of England, which increased its interest rates for just the first time in more than a decade in November and will publish it most recent rate decision Friday at noon.

In November, total United Kingdom retail sales rose by 1.1% compared to a 0.5% rise in October, surpassing forecasts by economists of only 0.4%.

Household electrical appliances led growth in sales, partly due to reduced prices during the Black Friday sales.

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But the picture was less rosy when comparing the past three months with the same period a year earlier - smoothing out monthly volatility.

When the BoE raised interest rates on November 2, it forecast real-terms household consumption growth would slow to 1 percent next year from 1.5 percent predicted for this year as demand shifted towards business investment and exports.

Still, the sales figures are encouraging for the health of the economy, providing a shot in the arm for retailers hit by higher inflation driving up their costs and potentially discouraging shoppers.

ONS senior statistician Rhian Murphy told media: "Household goods stores had a good November, with a number of businesses saying that Black Friday promotions boosted sales".

The growth comes as average store prices increased by 3.1% compared with November previous year, with food stores having the largest rise of 3.6% since September 2013. This was the biggest increase since April, when sales advanced 1.9 percent.

But home furnishings company Carpetright cut forecasts after warning of fragile consumer confidence.

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