Retail sales bounce back in March

Retail sales staged an unexpected recovery in March, providing some respite for the embattled high street.

Sales volumes increased 0.2% in March compared to the previous month, said the Office for National Statistics (ONS), with sales up 1.3% on the same month last year.

Driving the year-on-year increase in sales volumes was other non-food stores, which climbed 8.2%, and non-store retailing which surged 13.1%. 

Meanwhile, the value of retail sales increased 0.1% from February to March and 4.5% over the year.

The ONS said all stores with the exception of household goods stores experienced increases in the value of retail sales, with prices across all stores estimated to have risen 3.4% from March 2010 to 2011.

Today's data comes after a revised 0.9% drop in sales in February and follows a glut of downbeat news hitting the high street, including a gloomy survey released by the British Retail Consortium last week.

Following release of the figures, the pound climbed half a cent against the dollar to $1.655. The sales data could also increase the likelihood the Monetary Policy Committee will hike interest rates over the summer, with consumer spending a key criteria for policy makers.

Yesterday, minutes from the MPC's April meeting showed the committee was again divided six-three against a rate rise.