British retail sales rebounded in November, up 0.3 percent month on month, though economists on Thursday said growth had slowed and may have peaked, leading to predictions of a post-Christmas fall in sales.
Consensus expectation had been for growth of 0.3 percent in November, set against a fall of 0.9 percent in October.
Blerina Uruci, British economist with Barclays Economics Research, said the overall performance of retail spending for the first two months of final quarter of 2013 remained subdued, with the three months to November seeing sales volumes fall marginally. Robust growth seen during the second and third quarter had flattened out.
"Although November data reported a small rebound from the large fall of the previous month, the overall picture for Q4 remains subdued in our view and in contrast with the solid pick-up in consumer demand we have seen in recent months," said Uruci.
The weakness in retail sales is broadly in line with weak real incomes, an historic low of 0.8 percent against a background of falling CPI at 2.1 percent.
Uruci said this was likely to act as a continuing drag on household demand.
"The economic outlook has improved, and higher confidence may have given a boost to consumer spending as the need for discretionary spending diminishes and employment prospects pick up. The recovery in household demand is likely to be sustained, but it is unlikely to be especially strong by historical standards," said Uruci.
The monthly growth in volumes was strong in clothing stores and online in general, but offset by weak household goods and petrol sales. Internet sales continued to grow as a proportion of total retail sales reaching a record 11.9 percent of total.
Non-food sales are on an upward trend, but food sales have dropped after strong sales sparked by good summer weather.
John Zhu, UK economist with HSBC Global Research, said, "There are reports that retailers are being forced to discount heavily again, which could drive volumes during the Christmas/January sales season."
"Unless earnings start to grow more rapidly, the modest trend may continue and limit the upside to retail sales. We may yet see a post-Christmas hangover," he added.