Retail sales increased in the month of October with many suggesting that consumers moved forward purchases ahead of January 2011’s rise in VAT to 20%.

An increase of 0.5% as reported by the Office of National Statistics represents a turnaround from the previous two months of decline, despite the performance being 0.1% lower than October 2009.

The growth was buoyed by an increase in sales volumes in non-food stores, including demand in textile, clothing and footwear shops.

Howard Archer, chief European economist at HIS Insight said the sales growth was “decent but unspectacular”.

He continued adding “ It is likely that retail sales will benefit to a limited extent in the final weeks of this year from consumers looking to make purchases of more expensive items ahead of the January VAT increase from 17.5% to 20%.

“ Retailers will also be fervently hoping that consumers decide to splash out and have a good Christmas despite their worries and uncertainties over the economic outlook.”

Please note the views expressed in this blog are the views of the author, Andre Brown and do not represent the view of Locayta, its employees or its shareholders. For more information about Locayta, visit www.locayta.com