United Kingdom retail sales gained more than expected in April as nice weather prompted Britons to splurge on their homes and gardens.
United Kingdom retail sales recovered at a faster than expected pace in April, figures from the Office for National Statistics showed Thursday.
Sterling was 0.1 percent lower at $1.2962 by 0737 GMT, after again testing the $1.30 mark on Wednesday.
Average prices slowed slightly in April, falling from 3.3% in March to 3.1%.
Rising inflation is expected to take its toll on consumer spending this year, knocking the main engine behind United Kingdom economic growth since the end of the financial crisis.
"UK retail sales figures should help to allay concerns that real consumer spending growth is slowing sharply in the face of higher inflation", said Ruth Gregory, UK economist at Capital Economics.More news: White Tulsa police officer acquitted over fatal shooting of unarmed black man
The number of jobless people, who are not in work but seeking and available to work, fell by 53,000 to 1.54 million in the first quarter this year, Xinhua news agency reported on Thursday. "With Amazon soaking up much of the online market, too much competition on the high street leading to oversupply and price rises thanks to inflation, we expect consumers to take a breather from retail buying later this year with a survival of the fittest scenario playing out amongst retailers". That may be starting to limit pricing power for retailers, as annual increases in shop prices slowed to 3.1 per cent from 3.3 per cent.
Excluding auto fuel, retail sales climbed 4.5 percent, following March's 2.8 percent increase. "The suspicion is that it needs something special like markedly warmer weather to now get consumers to really loosen their purse strings".
The UK unemployment rate has fallen to its lowest level in 42 years, according to the latest figures from the Office for National Statistics (ONS).
"Compared with March 2017, April 2017 has shown increases in the quantity bought and amount spent across all store types except department stores and textile, clothing and footwear stores", the ONS said.
The nicer weather particularly drove demand for hardware and household goods, the ONS said.
"Clearly, the retail industry is still benefiting from strong spending growth after a sustained period of broadly confident consumers that are benefiting from low interest rates and record levels of employment".