Data from the Office for National Statistics show that annual sales growth soared to 6.3% - the biggest rise for three years as stores slashed prices to lure shoppers in. The Times. The Independent. The Daily Telegraph. The Guardian. Financial Times
Sales volumes in September jumped 0.6% compared with the predicted 0.1%.
However, the price of goods sold was around 1.5% lower than last year.
Geoffrey Dicks of the Royal Bank of Scotland noted ‘a sea-change in high street pricing’ since the spring. While food inflation remains high, prices in nonfood stores had tumbled by 3% over the past year, the strongest deflation for three years.
Peter Newland of Lehman Brothers said: ‘Strength in the third quarter has in large part been driven by lower prices for consumer goods. Other fundamental factors, such as income growth and interest rates, point to a slowdown in spending in the fourth quarter and into 2008.’