Headline sales were flat in the month in volume terms in November but were 1.7% higher in the year, following an annual decline of 1.2% in October. Excluding motor trades, sales were up 1.3% in the month and were 1.6% higher in the year. <p>
A key issue going forward will be the state of the labour market, and the signs are encouraging on this front. A continuation in the trend of falling unemployment in the coming months will eventually be reflected in stronger retail sales in our view. <p>
After falling by 0.7% on average on an annual basis in the first half 2012, the third quarter was much stronger, with headline sales in July-September 2.8% higher than the same period in 2012. This could be enough to see a positive out-turn for 2013 as a whole especially as the average trend in the first two months of the final quarter was also positive.<p>
<b>However, overall personal expenditure on goods and services for 2013 as a whole as per the National Accounts looks set to be negative again. Still, we remain optimistic that buoyed by an improving labour market, consumer spending will make a positive contribution to GDP growth in 2014.
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