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Rain dampens retail sales figures in May

Published On 5 June 2007 at 12:14:59

Bad weather during May was partly responsible for the poor retail sales figures which small and medium-sized enterprises (SMEs) in the UK recorded in the month, a new report argues.

The latest retail sales monitor from the British Retail Consortium (BRC) and KPMG shows that retail sales only grew at 1.8 per cent in May, compared to 3.6 per cent during the previous month.

This was a lower rate of growth than the average monthly figure recorded in 2006 and SMEs selling clothing and footwear, as well as DIY and gardening products, suffered particularly badly.

"Although the weather was bound to depress sales growth, many of our members believe that the cumulative effects of the recent rate increases are now beginning to show up in these figures," explained Kevin Hawkins, the director general of the BRC.

"The Bank should think twice before putting up rates again in the near future."

Dr Gavin Cameron, a reader in macroeconomics at Oxford University, added: "The Bank of England has not raised interest rates in two consecutive months since May/June of 2004.

"Although some inflation hawks argue it might resort to such a tactic again this month, continued slack in the labour market and benign wage growth suggest that the next rate rise may wait until later in the summer."

 

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