Finance 2.0

Today UK retail figures for may were released and they were impressive. Month on Month sales were up 3.5% and Year on Year by 8.3%

See for yourself here: http://news.bbc.co.uk/1/hi/business/7462945.stm

Record sales of food and clothes led overall UK retail sales to jump by 3.5% during May, official figures show.

The 3.5% rise was the strongest monthly growth in retail sales volumes since the series began in January 1986.

It’s a shame the press don’t do it’s readers justice and explain that why this is not as good at it sounds. You think at least someone would critically analyse the results instead of just looking at a number above zero as good and a number below zero as bad.

While these figures may look nice, to me they are a result of inflation and a weak benchmark comparisons. I find the way they represent these statistics very annoying. Why can’t they use a real index? I don’t look at the FTSE 100 index and get a view of it’s MoM, YoY values. I see it’s current value and the graph paints the picture of performance! At least a trailing average or something too to reduce the effect of volatility .

I guess it’s an easy way to make them more misleading. After all a 50% drop requires a 100% gain just to get back to even. The 100% increase is much more impressive right? I had a quick look around though and you can of course get the data to do your own calculations with.

http://www.statistics.gov.uk/STATBASE/tsdataset.asp?vlnk=706

A quick look at last May shows very weak retail growth. A quick think back reminds me of a very wet rainy May.

Need I say any more? Figures sound great but the increase is large because of inflation and a weak May 2007 due to poor weather. April retail sales were poor too.

When I get a chance I’ll take a deeper look into the actual indexes and which retail sectors are strongest. I expect food is really propping the index up.

There is also the issue of sales for me. This year has been a sales frenzy especially at places like Currys’. Would it be a surprise if people are picking up bargains despite being tight on cash?

Edit: Found this article. Well done to thisismoney.co.uk / Evening Standard

http://www.thisismoney.co.uk/news/article.html?in_article_id=443335&in_page_id=2&ct=5