The rising cost of fuel is benefiting the high street at the expense of out-of-town retail parks, said Marks & Spencer chief executive Sir Stuart Rose.

Price-conscious consumers are saving on petrol by shopping in town centres, he told the British Retail Consortium conference yesterday.

“We’re seeing changes in our business,” said Rose. “If a tank of petrol costs 40 per cent more than it did, are you going to drive to Bluewater or walk down the high street?”

He believed that, despite torrid conditions at present, high street retailing has a healthy future. “I’m optimistic about the high street,” he said. “It has had its low point. We won’t see any more Bluewaters. I think we’re pretty much done out-of-town.”

He also said that some inflation in the economy was preferable to stagflation and could help speed the end of the downturn.

“I’d go for a bit of inflation and buy your way out,” said Rose. “If we’re not careful, we could be in danger of digging ourselves into a deeper place than we need to be.”

City speculation that as many as three more interest rate rises may be on the cards as the Bank of England battles inflation “horrified” Rose.

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