January sales “surprisingly strong”

Retail sales grew 2.3% in January despite consumers feeling “gloomy” about the year ahead, according to the British Retail Consortium.

The like-for-like sales lift reversed the 0.7% decline recorded in January 2010, when sales were impacted by snow and fell.

Total sales were 4.2% up, compared to a 1.2% increase in January 2010. Sales were boosted by clearance sales and promotions.

Non-food sales were boosted by pre-VAT rise purchases and January sales at the start of the month, but this tailed off towards the end of the month.

Food sales growth slowed as shoppers had less need to buy food after stocking up during December’s cold weather and the festive season.

Stephen Robertson, director general of the BRC warned that the “surprisingly strong” sales figures in January are against “feeble comparisons” in January 2010 and warns that shoppers are facing increasing economic pressures following the Government budget cuts.

According to a separate report by IGD, a third (61%) of consumers think they will be worse on in the next 12 months than last year.

Sixty one percent plan to cut down what they spend on eating and drinking, while 58% plan to reduce how much they spend on clothing.

The study also revealed that 32% of consumers mistakenly believe the VAT increase applies to all their food and grocery shopping.

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