London: British retail sales jumped last month by the most in one-and-a-half years, official figures showed on Thursday, suggesting the economy was recovering from a snowy start to the year.

The Bank of England is waiting for signs of recovery before it raises interest rates again and sterling was up by half a per cent on day against the US dollar after the stronger-than-expected sales figures.

On Wednesday, the pound hit its lowest level of 2018 against the dollar after inflation unexpectedly fell, raising fresh doubts about the timing of the BoE’s next rate hike.

Retail sales volumes rose by 1.6 per cent from March, the Office for National Statistics said, well above the median forecast for a monthly 0.7 per cent increase in a Reuters poll of economists.

The ONS said warm weather in April brought consumers back into the shops. But it warned that the big picture remained one of subdued spending with sales broadly unchanged over the past six months.

Peter Dixon, an economist with Commerzbank, said the figures were a rare piece of positive news about the economy after the weak start to 2018, although the sales data tends to be volatile.

“These figures show the consumer is not dead and they keep the Bank of England on its toes,” Dixon said. “This is grist for the mill for those think a rate rise is justified sooner rather than later.”

April’s sales pickup followed a sharp fall of 1.1 per cent in March when Britain was still in the grip of unusually cold winter weather.

In the three months to April, sales edged up by 0.1 per cent compared with a fall of 0.4 per cent in the three months to March, the biggest decline in a year.

Growth in wages

British households were hit last year by a combination of rising inflation and weak wage growth. Recent figures have shown a cooling of price growth and a pickup in wages.

But many retailers are struggling as consumers remain wary about spending and online shopping upends the industry.

Marks & Spencer, House of Fraser and New Look among other chains have said they plan to close shops. But clothing retailer Next said earlier this month that warmer weather in April boosted its sales.

Figures on Wednesday from the Confederation of British Industry showed retail sales picked up moderately in May.

A gauge of inflation used in the retail sales data picked up to 2.2 per cent after sinking in March to its lowest since January 2017 at 1.9 per cent.

The ONS said retail sales in cash terms grew by 3.5 per cent in April in annual terms, up from 3.2 per cent in March.