–Adds Detail To Version Transmitted At 0930 GMT
–Feb Retail Sales inc. fuel +2.1% m/m; +3.5% y/y
–Feb retail sales ex fuel +1.6% m/m; 5.4% y/y
–Retail sales above median forecast of +1.3% m/m
–Jan retail sales revised down to -3% m/m from -1.8% m/m

LONDON (MNI) – Retail sales bounced back sharply in February as
sales at household goods stores rose at the fastest rate on record,
according to figures released by National Statistics Thursday.

Retail sales volumes including auto fuel rose 2.1% on the month in
February and were up 3.5% on the year. The February increase on the
month was the largest since May 2008 and was above the median forecast
for a rise of 1.3% on the month.

There was, however, a sharp downward revision to the January data
which now shows volumes plunged 3% on the month, the largest fall since
June 2008, compared with the originally estimated fall of 1.8%.

National Statistics said the revision to January was mainly due to
late data returns from retailers and also some revisions to the auto
fuel series.

The erratic data seen over the past few months make gauging the
underlying strength of the retail sector, as well as other areas of the
economy, difficult.

In a speech last month Bank of England Governor Mervyn King said
“Over the next few months, the data are likely to be dancing
particularly vigorously under the influence of the reversal of the VAT
cut, a turnaround in the stock cycle and even the effects of the recent
cold weather.”

This suggests the Monetary Policy Committee is unlikely to make any
changes to the current policy stance until it can see a clearer picture
of the underlying strength of the economy.

The rise in sales in February was led by sales a household goods
stores which rose a record 11.2% on the month following a 13.8% monthly
drop in January due to the poor weather conditions seen throughout the
country.

There was also a 1.1% rise in clothing and footwear and a 2.8%
increase in other store sales. Sales at non-specialised stores
(department stores) were down 0.4% on the month.

Overall, non-food store sales were up 3.4% on the month while
predominantly food store sales fell 1.2%.

Non-store retailing sales leapt 3.6% on the month and were up 20.4%
on the year, the highest annual increase on record.

Predominantly auto fuel sales were up 9.1% on the month in February
following a sharp weather related fall in January.

–London bureau: 00 44 207 634 1655; email: drobinson@marketnews.com

[TOPICS: MT$$$$,M$B$$$,MABDS$]