By Claire West
Commenting on the retail sales figures for September, published today by the ONS, David Kern, Chief Economist at the British Chambers of Commerce (BCC), said:
“Retail sales fell in September for the second month in a row, despite hopes that there would be a small increase. These figures support our assessment that there will be a significant slowdown in the rate of growth in the third quarter of the year, although GDP will still remain positive.
“There is no need for undue pessimism, since longer-term comparisons still show positive growth in retail sales. However, it is important to take steps to reduce risks of a setback in the early months of 2011, when VAT goes up and the spending cuts start to bite.
“Businesses and consumers are facing serious pressures, which are likely to worsen in the months ahead. Since minimising threats of a new recession remains a key policy priority, it is important for the Government and the Monetary Policy Committee to concentrate on supporting the modest economic recovery.”