INSTANT VIEW- October retail sales and public finances data

LONDON (Reuters) - Retail sales fell less than expected in October and the public finances showed their first deficit for the month since 1994, official data showed on Thursday.

ANALYST COMMENT

PHILIP SHAW, CHIEF ECONOMIST, INVESTEC

(RETAIL SALES)

"The figures were a little firmer than expected and we suspect the ONS data are probably understating the weakness of sales. But the broad breakdown seems believable. Food stores gained heavily on the month and household goods sales collapsed. "Overall the ONS data suggest sales are flat on a trend basis. We would suggest they are falling but nonetheless there has been a big sea-change over the past year."

(PUBLIC BORROWING)

"The October data don't change the overall situation which is that government borrowing is escalating and that's a timely reminder ahead of the likely tax-cutting package in Monday's PBR. Whilst we think on balance a fiscal giveaway is justified there is going to have to be a big fiscal clean up operation once the economic recovery kicks in."

EHSAN KHOMAN, EUROPEAN ECONOMIST, SOCIETE GENERALE

"Retail sales' slight contraction was broadly in line with our forecast. Clearly the key point this highlights is that consumer demand is weakening. Rising unemployment and turmoil is dissuading households from their usual spending.