Latest figures from the Office for National Statistics (ONS) show that UK retail sales unexpectedly rose 0.6% in October compared to September. This is despite the latest monthly consumer confidence index from Nationwide showing that confidence in October had fallen to the lowest level since the survey began in May 2004.
The ONS said the food sector had accounted for much of the increase, driven largely by price promotions and a price war between supermarkets in the run up to Christmas.
Sales volumes in small stores rose 5.3% year-on-year which may indicate that shoppers are avoiding out-of-town shopping malls in order to cut down on petrol costs.
David Kern, chief economist at the British Chambers of Commerce said, "The retail sales figures were better than expected, although longer-term comparisons still point to a flat picture." Despite the better-than-expected sales figures, a number of updates from High Street retailers indicated that many chains are still struggling in the current economic environment.
The Nationwide confidence index index fell for the fifth month in a row in October to 36, well below the long-running average of 78.
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