UK retailers say sales bounced back in October

U.K. retailers reported their best year-on-year growth since 2002 in October, with sales up 3.8 percent from a year earlier, when financial markets were crashing, the British Retail Consortium said Tuesday.

The figures do not account for new stores opened over the past 12 months. Total sales including additional floor space were up 5.9 percent.

Still, the authors of the report said the gains will be difficult to sustain.

"The longer-term outlook remains considerably more challenging, given the economic backdrop, levels of unemployment, uncertainty regarding the impending (sales tax) rise and the impact of future fiscal policy following next year's election," said Helen Dickinson, head of retail KPMG, which cooperated in preparing the BRC report.

On the up side, conditions are benign "with less discount activity as most retailers approach Christmas with less bought in stock," said Freddie George, retail analyst at Seymour Pierce.