In a further sign of a consumer-led recovery, the CBI’s latest snapshot of the UK high street revealed far stronger growth than had been expected.
Yesterday’s findings pointed to a broad-based revival, with sales of clothing, food and recreational goods performing particularly well.
Employment in the sector grew at its strongest rate since May 2002 and is expected to grow firmly again next month.
Barry Williams, who chairs the CBI distributive trades survey panel, said: “The feel-good factor from the heatwave, summer sales, royal baby fever and sporting victories has helped boost the high street.”
The sales balance in the quarterly report jumped to +27 compared with economists’ forecasts for a rise to +19. It marks the highest reading since last November.
Recent official data showed that retail sales rose at their fastest annual rate in more than two years during July as the hot weather boosted sales of barbecue food and outdoor items, adding to signs that the economy got off to a strong start in the third quarter.
David Tinsley, UK economist at BNP Paribas, the investment bank, said: “Overall, most sectors of the economy appear to be stepping up, with the consumer led ones in the lead. From the admittedly sketchy indicators for Q3 so far, it would be a surprise if GDP [gross domestic product] growth was not at least as good as Q2.”