Official statistics have shocked experts, by revealing that UK retail sales remained unimproved on August’s figures, with zero growth for September. This failure in the increase of retail sales has occurred for the second month in a row.

The expectations have been raised recently, with experts predicting that the UK was on course for economic recovery, but these figures raise serious doubts, with the public still hesitant to spend.

This information arrives in advance of figures due on Friday, that are largely expected to show a growth in the UK economy for the third quarter (Q3) of 2009; the first growth in over a year.

Although monthly growth may have wilted recently, September saw retail sales up by 2.4% on September 2008 figures, but below the anticipated 2.8% predicted by forecasters.

A year ago, consumers were reluctant to spend, with the financial system in turmoil and the Lehman Brothers going bankrupt.

The figures released for the retail sector have been much poorer than many had anticipated. Food-based stores were down 0.1% for September and non food-based stores saw no growth at all. Textile, footwear and clothing sales were even worse, falling 0.5% in total.

Upon the release of this news, the pound immediately fell in value against the Dollar and the Euro.

UK economist at Capital Economics, Vicky Redwood, was taken aback by the data. “September’s official UK retail sales figures are surprisingly weak given the strong rise in the timelier CBI and BRC surveys.”

The distributive trades survey conducted by the CBI found that High Street activity was at a five-month peak during September. The British Retail Consortium also revealed that the month of September delivered the “best total sales growth figures since January 2008.”

Some experts had expected to see a rise in retail activity in advance of the VAT hike from 15% back to 17.5%.

Many retailers don’t feel as positive, however. Sir Philip Green, head of Arcadia Group, which owns Wallis and Topshop, spoke to the BBC, predicting “I don’t think it gets a lot better over the next year.”

Arcadia have announced annual pre-tax profits of £213.6m, a rise of 13% on last year’s £188.9m figure.

Others have also experienced profits. Debenhams, the High Street department store revealed that due to the “Designers at Debenhams” range, their profits were up 13% to £213.6m compared to last year’s £188.9m. Their chief executive, Rob Templeman believes that many discounts will need to be made if Christmas shoppers are to be tempted to buy, declaring “I think it will be as promotional as last year.”

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