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UK retail sales fall despite World Cup fever

U.K. retail sales fell in May, even as sales of sportswear and toys were boosted by the World Cup.

Retail sales volumes including fuel were 0.5 percent lower compared with the previous month, and 3.9 percent higher compared to the same period in 2013. The slowdown in sales follows April's 10-year high of 6.9 percent, the Office for National Statistics (ONS) said.

All sectors except fuel stores showed increases in the quantity bought year-on-year. Sporting equipment and clothes surged 28.9 percent from a year ago

"Feedback from retailers in these stores has suggested that the increase in sales in May 2014 is due to the build-up of the FIFA World Cup," the ONS said in a statement. "A better picture of the impact of the World Cup on retail sales statistics will be available when June data are released on 24 July 2014," the ONS said.

Chris Ratcliffe | Bloomberg | Getty Images

Prices rose for food, but all other sectors saw average prices fall compared with May 2013.

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"Despite falling in May after an Easter-holiday related surge in April, retail sales are growing at an impressive pace so far this year. With sales up some 4.3 percent (excluding fuel) on last year during the first five months of 2014, retailers are enjoying the best start to a year for a decade," said chief economist at Markit, Chris Williamson.

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"More important will be whether this growth will weaken as we move into the second half of the year. A delay in the first hike in interest rates until next year is based on the assumption that economic growth will slow to 0.7 percent in the third quarter. Any signs of growth momentum being sustained or accelerating in the third quarter adds to the likelihood of rate rising later this year," he added.

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