Latest retail stats make case against interest rate rise
Weak Christmas retail sales figures show conditions are fragile and make the case for interest rates to remain unchanged.
The statistics, published today (Friday) by the Office for National Statistics (ONS) paint a similarly downbeat picture to the BRC's Retail Sales Monitor, released last week. The ONS figures show extreme weather and economic worries hit sales. Sales volumes (including petrol) were actually lower in December than November and flat compared with December 2009.
British Retail Consortium Director General, Stephen Robertson, said: "These official figures back up the BRC's own, which show 2010 ended on a flat note for many retailers. The unusually early winter weather compounded the effect of economic worries to make a difficult Christmas worse.
"The Bank of England must resist calls to increase interest rates while economic recovery
remains so fragile. These figures show the private sector still needs support. Hard-pressed families are already under pressure from higher VAT while National Insurance goes up for many in April. Concerns about job security and renewed weakness in the housing market have knocked consumer confidence again. Holding interest rates and keeping the March Budget free of new burdens are key to enabling retailers to continue their vital contribution to job creation and growth."
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