Eurozone retail sales boosted by clothing and food

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Eurozone retail sales grew in September, buoyed by sales of clothing, food and tobacco.

Eurostat, the European Union's statistics office, said retail sales in the region rose 0.7% month-on-month and 3.7% year-on-year.

The figures eclipsed a 0.4% fall in car fuel sales in the month.

The data indicates the area's economy is picking up amid stronger domestic demand. Economists expected less of an overall improvement.

Eurostat attributed the increase in September retail sales to a rise of 0.5% for non-food products, which include clothing, furniture and electrical goods, and an advance of 1.3% for food, drinks and tobacco.

Ireland, Denmark, Luxembourg and France led the stronger retail volumes, while the UK, Croatia and Lithuania had the biggest decreases.

Unofficial data showed sales of non-food items in the UK grew at the slowest pace since records began as families chose days out over shopping. The British Retail Consortium said the figures would give retailers "cause for concern" in the run-up to Christmas.

Higher growth

The European Central Bank in September raised its eurozone economic growth forecast for the year to 2.2%, the fastest pace in 10 years.

The eurozone economy ended the third quarter of the year on a strong note, according to an IHS Markit survey released that month.

The manufacturing sector observed the biggest rise in employment in over two decades, signalling that this quarter may also register strong manufacturing growth.