09 August, 2008

According to a figures, retail sales in the US increased at the slowest speed in four months as consumers are facing difficulty with the rising food and fuel costs.

In the US the spending of consumers is closely observed as it creates over 60% of total economic activity.

The world's largest retailer, Wal-Mart, posted poor sales for July and said the outlook between now and September looks unacceptable.

According to other major retailers including Limited Brands, Pacific Sunwear and Gap, shows a decrease in same store sales of 5%, 4% and 11% respectively. Wal-Mart's competitor, Target said same-store sales fell 1.2%, which was worse than estimated.

Hot Topic which is one of the other US retailers revealed that same store sales decrease 2.1%, while department store firms JC penny and kohl's showed a poor than expected performance in same store sales.

However, one area of retail sector that is making profit from major retailers downfall are discount stores including Costco and BJ's Wholesale Club who placed a 10% rise and a 16.7% rise respectively.

Recent released figures of this week showed that consumers in the US have been strike by the biggest increase in prices in approximately 30 years.

The Commerce Department revealed that consumer spending before take out inflation increased by 0.6% in June after a 0.8% increase in May.

The US is fighting with rising inflation and a risk of depression, and as a result, this week the US Federal Reserve left the interest rates unaffected at 2%. The US interest rates have been seized since April after violent slash in late 2007 and early 2008.

The Bank of England's Monetary Policy Committee declared that they are keeping interest rates on hold at 5%, as the battle with increasing inflation and a fear of downturn.'

Retail sales on the UK High Street have slashed to their lowest level for a quarter of a century.

Figures from the CBI show that 61% of businesses said activity was lesser in July in contrast with a year earlier while just 25% said it was at top. UK retailers are planning to announce poor results include Marks & Spencer, John Lewis and Woolworths.

Firstchoiceloan is a specialist in providing secured loans