Retail sales fall worst since May

Retail sales fell in February as retailers experienced the worst trading performance in nine months as consumers continue to tightly manage household budgets, according to latest figures.

High Street

Volume sales fell 0.8% compared to the previous month and value sales fell 0.4%, according to the Office of National Statistics. The drop is bigger than expected by analysts.

Comparisons with the previous year are more favourable with value sales 3.2% higher and volume sales up 1% year-on-year.

The ONS says that consumers spent £24.6bn (seasonally adjusted) in the retail sector in February 2012, compared to £24.4bn in January 2012 and £23.9bn in February 2011.

The figures will further dampen hopes that consumer confidence is returning but the ONS offers some encouragement on the long-term prospects saying that “the underlying longer-term movement within the series is one of growth” for both volume and value sales.

Both Next and Kingfisher, which owns B&Q, reported a rise in profits today (22 March) although like-for-like sales at both chains were 1.4% down on last year.

High street games retailer Game yesterday ceased trading its shares after admitting that they are worthless, in the latest example of a high street retailer succumbing to the ongoing economic challenges.

Peacocks, La Senza and Blacks Leisure have all fallen into administration this year.

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