British retail sales fell less than expected in July after their sharp jump in the month before, official figures showed on Thursday, suggesting consumer spending may be stabilising. The Office for National Statistics said sales fell by 0.3 percent on the month in July after a downwardly-revised 1.2 percent gain in June. Analysts had predicted a fall of 0.6 percent, Reuters said today. This took the annual rate of expansion to 1.8 percent from 1.2 percent in June and the ONS said underlying growth in retail sales was on a gradual upward trend which may encourage expectations that the Bank of England would leave interest rates on hold at 4.5 percent for now. The ONS said a few retailers reported lower sales because of the bomb attacks in London last month but the overall effect was hard to quantify. Separately, the ONS reported a higher than expected public sector net cash surplus of 8.25 billion pounds on higher corporation tax receipts and lower erratic expenditure. The government's preferred measure of the public finances -- net borrowing -- posted a surplus of 2.87 billion pounds.
