THE appetite of shoppers proved surprisingly strong last month and sales rose at their fastest rate since July.

Figures released by the Confederation of British Industry (CBI) offered much-needed cheer to retailers ahead of the Christmas season, although the employers' organisation said the underlying trend for the past three months was still below par for the time of year.

Economists, many of whom had been expecting a weaker figure, said the improved data was unlikely to lead the Bank of England to raise interest rates at its meetings today and Thursday.

In its monthly distributive trades survey, the CBI said 37 per cent of retailers reported a rise in year-on-year sales, while 26 per cent said there had been a fall.

The balance of plus 11 per cent compared with minus nine per cent last month - still well below the peak of plus 51 per cent during May.

Elsewhere, separate data showed shop prices hit their lowest level since January last year, suggesting many of the sales were generated by heavy discounting.

The British Retail Consortium's survey said shop prices fell by 0.39 per cent in October as retailers responded to heavy competition.

Separate figures due to be published today will show that consumer confidence in the economy remains strong despite rises in interest rates and oil prices and the downturn in the housing market.

Interest rates could peak at five per cent without causing major problems for consumers or the housing market, the Nationwide Consumer Confidence Report predicted.