UK retail sales fall short of market hopes
UK retail sales came in lower than expected in July and the country's three-monthly borrowing figures rose, according to official data.
Sales rose 0.1% in July against June and by 2.6% against the same month a year ago, figures from the Office for National Statistics (ONS) showed. The market was expecting a month-on-month figure of 0.4%.
Meanwhile, the public sector borrowing deficit excluding financial interventions in July fell by £800m to £200m from a year earlier.
Public sector net borrowing between April and July 2014 rose £9.4bn to £32.4bn against £23bn between April and July 2013, although higher APF transfers in 2013/14 partly explain this increase, the ONS said.
Economists welcomed the figures but cautioned about the potential impact of an interest rate hike, which is expected later this year or early next year.
Samuel Tombs at Capital Economics said the July figures may have been artificially high due to the World Cup and a slightly later start than normal to summer sales.
"July's UK retail sales figures provide reassurance consumers are still willing to spend more even though an interest rate hike is looming," he said.
PW