British retail sales unexpectedly fell in July for the first time in six months as electrical stores suffered after an earlier World Cup boost.
The Office for National Statistics (ONS) said today that sales volumes fell by 0.3 per cent last month, confounding expectations of a 0.2 per cent gain. June's initially reported 0.9 per cent gain was also revised lower, to 0.7 per cent.
The pound fell around a third of a US cent, and government bond prices jumped as dealers bet the weak data would deter the Bank of England from following up on its surprise quarter-point rate hike this month with another move before Christmas.
Household goods suffered most in July, with volumes dropping by 3.4 per cent despite inflation data earlier in the week revealing big discounting in the sector.
The ONS said this was partly due to sales of electrical goods tailing off after the boost to flat-screen TV sales ahead of the soccer tournament.
Clothing stores did well in July, but the ONS said this reflected steep discounting. Prices overall were on average 0.5 per cent lower than a year earlier.