ONS sales update prompts call to lower interest rates

Commentators have reacted to the latest Office for National Statistics figures for December sales, saying they kick off a year likely to be dogged by sluggish trading. Some have also called for the Bank of England to reduce interest rates.

Barclays Business retail banking believed the figures were a sign of things to come. The bank's national retail director Paul Clarke said: 'Overall, 2004 was a healthy year for the high street. Previous predictions of a slowdown in retail sales are likely to be closer to reality in 2005, as consumers react to the rise in interest rates and a more sluggish housing market.'

The British Retail Consortium once again called for interest rates to be lowered to stimulate consumerism. BRC director-general Kevin Hawkins said: 'The figures come as no surprise. The trading environment this Christmas was tough. There is no doubt that consumer confidence is fragile and evidently people are cautious about spending. Uncertainty over the economy, the housing market and interest rates continue to take its toll. Dodging the issue of cutting interest rates can no longer be avoided.'