Thursday, November 19, 2009
Retail sales up, borrowing still heavily in the red
Posted by David Smith at 10:15 AM
Category: Thoughts and responses

News on the demand side of the economy was relatively good, retail sales rising by 0.4% in October for a 3.4% rise on a year earlier. Sales volume in the latest three months was up by 1.1%. Clothing sales appear to have been particularly strong in October. Household goods stores saw a 3.8% rise over the latest three months, partly reflecting the continued upturn in housing. Bank of England figures showed mortgage approvals up from 56,000 to 61,000 - almost to the level normally consistent with stable prices. More on the retail sales here.

The public finances were marginally disappointing, with net borrowing of 11.4 billion in October, compared with 0.1 billion a year earlier, and a current budget deficit of 7.7 billion, compared with a 2.2 billion surplus in October 2008. Though the figures were a touch disappointing, 86.9 billion of borrowing for the first seven months of the fiscal year does not obviously suggest a need for an upward revision of the Treasury's 175 billion forecast for the full year, particularly with VAT set to rise in the new year. More details here.