Retail sales the highest in three years in a surprise to economists | Money News

Retail sales are at the highest level in more than three years, in the latest measure of the UK economy to confound economists.

The amounts bought in shops rose 0.5% in September, far above the 0.2% contraction anticipated by economists polled by Reuters.

It was the fourth monthly rise in a row and brought volumes to their highest level since July 2022.

Doing well were computer and telecommunications retailers as the iPhone 17 launched in the month, while online jewellers reported strong demand for gold despite the price hovering around record highs.

It came despite a rainy month – which typically keeps shoppers at home – and a five-day tube strike in London.

The impact of the rain could be seen, however, in the boost to online spending, which rose to one of the highest levels since the end of the pandemic.

A good week for the economy?

Retail sales figures are significant as they measure household consumption, the largest expenditure in the UK economy.

Growing retail sales can mean economic growth, which the government has repeatedly said is its top priority.

Earlier this week, another key measure of the economy came in better than expected.

Inflation remained at 3.8% rather than rising to the widely expected 4% – double the target rate set by the interest rate-setters at the Bank of England.

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