UK retail sales rose more quickly than expected last month, in a sign that the consumer spending boom is still going strong.

We can rule out a December rate cut at this stage

Audrey Childe-Freeman, CIBC World Markets

The Office for National Statistics (ONS) said that retail sales volumes rose by 0.8% in October from September, and were up by 6% compared with the same period one year earlier.

The annual growth rate was the strongest since April this year, comfortably outstripping analysts' forecasts of a 5% increase.

The surprise jump in sales suggests that consumer spending remains strong despite global economic uncertainty, making an imminent cut in interest rates less likely.

Interest rate dilemma

Fears that the consumer boom could fuel inflationary pressures and trigger a crash in the overheated British property market have deterred the Bank of England from cutting interest rates to reinvigorate the embattled manufacturing sector.

Analysts said the latest figures had put paid to hopes that the Bank might reduce borrowing costs next month.

"This really confirms the view that the consumer sector is in good shape," said Audrey Childe-Freeman of CIBC World Markets.

"We can rule out a December rate cut at this stage."

The Bank of England has left rates on hold at a 40 year low of 4% for the past year.

Two-speed economy

Strong consumer spending, fuelled by historically low borrowing costs and high employment has propped up the UK economy despite sluggish growth in the US and Europe.

But the slowdown overseas has sapped growth in the UK's export-oriented manufacturing sector.

ONS said the latest increase in retail sales was driven primarily by clothing, footwear, and household goods.

October's strong sales figures suggest that retailers could be in for a bumper Christmas as consumers return in force to the shops after a disappointing summer sales season.

Retail sales slowed during the summer, weighed down by the World Cup football tournament and extra bank holidays to celebrate the Queen's Golden Jubilee in June.