LONDON: British retail sales unexpectedly held steady in February despite wet weather hitting in-store sales, according to figures from the Office for National Statistics on Friday that added to signs the economy is recovering from last year's mild recession.

The ONS said retail sales volumes were flat and remained 1.3% below the levels before the COVID-19 pandemic in 2020.

Economists polled by Reuters had forecast that sales volumes would fall by 0.3% on the month.

The flat figures in February follow a couple of volatile months when sales volumes slumped 3.5% in December after a weak Christmas trading period before jumping 3.6% in January.

Alex Kerr, assistant economist at Capital Economics, said the data provided further evidence that a recovery in retail activity and perhaps the wider economy was underway.

"The prospect of interest rate cuts and the boost to real household incomes from lower inflation and the 2p cut to national insurance in April suggest the recovery in real consumer spending will continue throughout this year," Kerr said.

The ONS said heavy rain contributed to falls in sales at food and household goods stores but boosted online shopping.

However, clothes sales rose last month as consumers opted to shop around for promotions and new collections.

Clothing sales rose by 1.7% - the biggest increase since December 2022 - after a 0.7% decline in January.

Compared with a year ago, overall sales volumes were 0.4% lower.

Separately on Friday, a survey showed British consumer sentiment held steady in March but households turned positive about the outlook for their personal finances for the first time in more than two years.

 - Reuters