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Fewer UK shoppers increase BoE stimulus prospects

Fewer UK shoppers increase BoE stimulus prospects
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Emptier shops mean Britain’s economy is on course for a third quarter of contraction.

British retail sales fell at their fastest rate in more than a year in April.

They were down by 3.3 percent from the same month last year. Analysts had expected a 0.5 percent rise.

That – along with a slowdown in jobs growth – increased speculation the UK central bank will have to look at more monetary stimulus despite inflation threats.

Although retailers’ takings were squeezed by rainy and cold weather, the poor returns will make it harder for the economy to eke out growth in the second quarter after it shrank between last October and March.

Meanwhile, the number of people placed in permanent jobs rose at the slowest pace since January, according to a survey for consultancy KPMG and the Recruitment and Employment Confederation – which represents recruitment agencies.

BRC Director General Stephen Robertson said the wettest April in Britain since records began had hurt sales of summer clothing and outdoor products, while a long Easter weekend early in the month meant some Easter shopping was shifted into March.

Shopping in March received an extra boost from unusually warm weather, which contributed to the biggest increase in retail sales in more than a year, according to the latest Office for National Statistics figures.

“It would have been difficult for this April to outperform April 2011 even with favourable weather, but these numbers are still disappointing,” Robertson said.

“April last year was boosted by the royal wedding and the accompanying extra day off for people to shop or celebrate.”