British retail sales in surprise January jump

In its monthly survey, the British Retail Consortium said like-for-like sales, which strip out new stores and space, increased by 1.1 percent in January from the previous year. In December, they had fallen by 2.2 percent.

The increase — the first for three months — was unexpected. Most analysts were expecting a 1 percent year-on-year decline.

When new stores and space are included, sales rose 3.2 percent, in contrast to the 0.1 percent drop recorded in December.

The survey showed that food sales were strong and that nonfood sales, though down on the previous year, did not fall as much as they had in December as a result of widespread discounting during the sales.

Stephen Robertson, the BRC's director-general, said the figures suggested there had been some "pent-up demand" as customers had waited until the post-Christmas sales to spend on goods they had intended to buy for months.

However, he cautioned against reading too much into one month's figures as the outlook for jobs was bleak and consumer confidence remained at very low levels.

"It remains to be seen whether January's discount-driven growth was just a blip," he said.

The news from the BRC comes just a week after the Halifax, Britain's biggest mortgage lender, revealed an unexpected 1.9 percent hike in house prices in January.

Separately, a leading organization of British chartered surveyors noted Tuesday that buyer interest was returning to the housing market but that this had not yet translated into sales.

The Royal Institution of Chartered Surveyors said the average number of transactions per chartered surveyor agency over the three months to January was down slightly to a new record 9.9 from 10.0 in the three months to December. RICS's statistics go back to 1978.

Jeremy Leaf, a spokesman for RICS, said transactions may pick up in the coming months if the government introduces guarantees for the issuance of residential mortgage- backed securities.

He also said the Bank of England's decision last week to reduce its benchmark interest rate further to a fresh record low of 1 percent, may also "improve confidence for those on the margins, encouraging buyers looking for more attractive finance deals."

RICS said house prices continued to drop in the three months to January, with 76.3 percent more chartered surveyors reporting a fall rather than an increase. That was modestly up on the 73.9 percent equivalent figure in December.