UK borrowing rises less than expected, retail sales see early Xmas boost
UK retail sales rose for the sixth consecutive month in October, underpinned by the online segment, while government borrowing hit its highest level on record for that month but was still lower than forecast, according to figures released on Friday by the Office for National Statistics.
Public sector net borrowing was £22.3bn in October, up £10.8bn from the same month last year and marking the sixth-highest borrowing in any month since records began in 1993, as the government continued to spend amid the pandemic. However, it was lower than the consensus forecast of £37.2bn.
Separate figures from the ONS showed retail sales rose 1.2% on the month in October, down from 1.5% growth in September but ahead of expectations for no growth. On the year, sales were 5.8% higher, coming in ahead of expectations for a 4.2% increase.
Deputy national statistician for Economic Statistics Jonathan Athow said: "Despite the introduction of some local lockdowns in October, retail sales continued its recent run of strong growth.
"Feedback from shops suggested some consumers may have brought forward their Christmas shopping, ahead of potential further restrictions. Online stores also saw strong sales, boosted by widespread offers.
"However, the slow recovery in clothing sales has stalled after five consecutive months of increased sales."
Capital Economics said: "The decent rise in retail sales in October and the smaller increase in government borrowing suggests that the economy held up better than expected when the Covid-19 tiered restrictions were being implemented.
"But the second lockdown that began in November will probably prompt retail sales to fall again and public borrowing to rise faster."