Weaker retail sales, jobs surveys raise risk of longer slump

The bleak news from retailers will further complicate the Bank of England’s decision on Thursday on whether to give another cash boost to the economy, which slipped into recession at the beginning of the year reports Reuters.

The central bank faces the dilemma of balancing weak growth with stubbornly high inflation.

The British Retail Consortium said on Wednesday that like-for-like retail sales – or sales at stores open for at least a year – plunged by 3.3 percent in value terms compared to April 2011, following a 1.3 percent rise in March.

The reading, the weakest since March last year, confounded analysts’ forecasts for a 0.5 percent increase.

Stephen Robertson, BRC Director General, said the wettest April since records began had hurt sales of summer clothing and outdoor products, while a long Easter weekend early in the month meant that some Easter shopping was shifted into March.

Shopping in March received an extra boost from unusually warm weather, which contributed to the biggest increase in British retail sales in more than a year, according to the latest figures from the Office for National Statistics.

“It would have been difficult for this April to outperform April 2011 even with favourable weather, but these numbers are still disappointing,” Robertson said.

“April last year was boosted by the royal wedding and the accompanying extra day off for people to shop or celebrate.”