U.K. Sept. Retail Sales Rise More Than Forecast on Rugby Cup

By Jill Ward

 U.K. retail sales rose the most in a year and a half in September as Britons took advantage of promotions on beer and food for the Rugby World Cup being held in Britain.

Volumes rose 1.9 percent from August, the biggest increase since Dec. 2013, the Office for National Statistics said in London on Thursday. That was more than the 0.4 percent increase economists had forecast in a Bloomberg survey. Sales rose 0.9 percent in the third quarter, contributing 0.1 percent to growth.

Food sales rose 2.3 percent, led by alcohol sales and food, as prices dropped. The food-price deflator was minus 2.1 percent, while the overall retail sales deflator was minus 3.6 percent in the period, matching the lowest since records began in 1988.

Negative inflation and strong wage growth are putting money in the pockets of consumers and helping them boost the British economy. Bank of England policy makers have been weighing that strength against the slowdown in emerging markets, with both Monetary Policy Committee members Kristin Forbes and Ian McCafferty saying the domestic economy is solid enough to warrant a rate rise soon.

Overall sales were up 6.5 percent on the year, while excluding auto fuel sales gained 1.7 percent on the month and 5.9 percent on the year.

Clothing and footwear created a drag on sales, falling 0.9 percent on the month.

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