British retail sales growth accelerated more-than-expected in July as the heatwave boosted food store sales, data showed Thursday.
Including automotive fuel, retail sales volume advanced 1.1 percent from the prior month, following a 0.2 percent rise in June, the Office for National Statistics said. Sales grew for the third month and the rate of growth was expected to rise moderately to 0.7 percent.
Sales that exclude automotive fuel also grew by 1.1 percent, which was faster than the 0.3 percent expansion seen in the previous month. The rate exceeded the consensus forecast of 0.6 percent.
Food store sales surged 2.5 percent, which was partially offset by a 0.3 percent drop in non-food store sales. Non-store retailing rose 1.7 percent in July.
According to a monthly survey carried out by the Confederation of British Industry, retailers expect sales volumes to increase again in the year through August after rising for the first time in five months in July.
Last week, Bank of England Governor Mark Carney assured that policymakers do not intend to hike interest rates from the current 0.50 percent, at least until the unemployment rate has fallen to a threshold of 7 percent.
However, Martin Beck, UK economist at Capital Economics said the resources to sustain growth in sales still look lacking with real pay set to continue falling into next year and households eating into their savings.
The ONS data today showed that all retailing including auto fuel climbed 3 percent annually, the biggest since January 2011. Sales were expected to grow by 2.4 percent after rising 1.9 percent each in June and May.
At the same time, annual growth in sales, excluding auto fuel, came in at 3.1 percent, up from June's 1.8 percent rise and above the 2.7 percent forecast.
At 2.1 percent, the volume of sales in the food sector increased at the fastest pace since April 2011. The amount spent increased 5.7 percent, the highest since September 2011.
The sunny weather boosted sales across a range of products, including food, alcohol, clothing and outdoor items.
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