The news on activity has struck a stronger tone over the last month. Annual GDP growth is estimated to have accelerated from 3.1% in Q2 to 3.3% in Q3 – the fastest rate in three years. Meanwhile, retail sales volumes rose by 6.2% in the year to September. Admittedly, high street activity has been boosted by heavy discounting. Nonetheless, retail sales values grew by 4.6% y/y in September. For the moment, then, the previous rises in interest rates and the credit crunch have yet to dent activity. But it might not be too long before consumers become less willing to open their wallets.
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