U.K. retail sales slipped on bad weather

Sales in Britain's retailers fell more than preliminary was estimated in March, as cold weather during the month depressed purchases of clothing and household goods. According to the Office for National Statistics, the U.K. retail sales including fuel dropped 0.7% from February, when they increased 2.1%, and below analysts' expectations, which called for a 0.6% decline. On a yearly basis, sales tumbled 0.5%. Among bad weather conditions, consumers' willingness to increase spending is affected by the weak wage growth and accelerating inflation, which are squeezing household budgets. During the last meeting, the BoE's policy makers were split on the need to expand its stimulus programme, expressing concern that the prolonged period of inflation above the 2% target may undermine price stability.

"The outlook for household demand remains weak," said Simon Hayes, an economist at Barclays Plc in London. "It is hard to see a sustained recovery taking hold until the caution around household income prospects lifts."

"The results are disappointing, but unsurprising. The prolonged cold weather has certainly taken its toll on the UK high street and has further discouraged consumer spending," said Peter Saville, partner at advisory and restructuring firm Zolfo Cooper.