Inflation and cuts hit retail sales

London: British retail sales fell in August for the first time in three months as waning consumer confidence deterred spending and some stores lost business due to riots in London and other cities.

Sales including fuel declined 0.2% from July, when they rose by the same amount, the Office for National Statistics said. On the year, sales were unchanged.

British consumers are being squeezed by inflation at 4.5%, almost twice the pace of wage growth. Coupled with the government’s budget cuts, that’s restraining the recovery and pushing officials at the Bank of England to discuss whether they need to pump more stimulus into the economy.