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LONDON (Reuters) - British retail sales rose more than forecast in January and the improvement was expected to continue, a survey by the Confederation of British Industry showed on Thursday.
The sales balance in the CBI distributive trades survey dipped to +17 from +19 in December. Analysts had forecast a reading of +12.
The expected sales balance for February climbed to +13 from +10 for January.
"Despite mixed news from the high street over the past few weeks, strong sales growth in the grocery sector has added a touch of sparkle to overall retail sales," said Judith McKenna, chief operating officer of Asda and chairwoman of the CBI panel.
"However, we are far from out of the woods," she added.
The CBI said sales of furniture and carpets and non-store trading including online sales were also very strong, while retailers of durable household goods suffered.
Sales volumes for January were broadly in line with the average for the time of year for the first time since April, the group added.
The survey follows earlier official data that showed an unexpected fall in British retail sales in December. The news dashed hopes of a Christmas boost for a struggling economy and pointed to a shopper malaise that has forced three well-known retail chains to seek protection from their creditors since the start of the year.
Figures due out on Friday are expected to show that Britain's national output contracted 0.1 percent on the quarter in the final three months of 2012, raising the risk of a third recession since the 2008 financial crisis.
(The story corrects the second paragraph to show that the sales balance dipped, not rose, in January.)
Reporting by Patrick Graham, writing by Olesya Dmitracova