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Heavy snow hits British retail sales in February

BRITAIN'S retailers saw sales fall again in February partly as a result of heavy snow across large areas of the country that kept potential consumers stuck indoors and the stores bringing an end to their massive discounting over the New Year period, a leading industry lobby group reported today.

In its monthly assessment of the sector, the British Retail Consortium said like-for-like sales - those that exclude new stores and space - fell by 1.8 percent in February from the year before, more than offsetting January's surprise 1.1 percent increase. Like-for-like sales have fallen for ten of the last twelve months.

The BRC also said that total sales, which do include new stores and space, were 0.1 percent higher in the year to February, way down on January's equivalent 3.2 percent increase.

"It's now clear we were right to fear January's surprise year-on-year sales rise was just a discount-driven blip," said Stephen Robertson, the consortium's director-general.

"Early February snow didn't help but customers and retailers' difficulties run deeper," he added.

A more detailed look at the survey shows that the food sales growth slowed while nonfood sales slumped with homewares and big-ticket items particularly hard hit.

Though the snow brought much of the country to a standstill, it did provide a boost to the sale of shovels, Wellington boots and duvets, as well as toiletries for winter hand and body care.

Elsewhere in a closely watched survey of the housing sector, the Royal Institution of Chartered Surveyors found that buyer interest continued to increase in February amid falling house prices and lower borrowing costs but the lack of mortgage finance available meant that sales continued to languish.

Interest was up for the fourth consecutive month and was most evident in London, it said.

"Potential buyers continue to come through estate agency doors but without mortgage finance, transaction levels are likely to remain close to all time lows," said RICS' spokesman Jeremy Leaf.

Leaf said the British government must provide guarantees for the new issuance of residential mortgage backed securities to help make mortgage credit available for first-time buyers in particular and give the housing market a much-needed boost.

"Without further intervention the housing market will continue to stagnate and the opportunity to take advantage of this renewed interest could be lost which will inevitably have serious implications for the wider economy," Leaf said.


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