Fund manager Paul Mumford branded the Bank of England 'reckless' for its decision to cut interest rates following a 5.9% year-over-year rise in retail sales.
Mumford, senior investment manager at Cavendish Asset Management, says positive retail data in July published today shows the Bank inaccurately predicted the impact of Brexit.
‘It’s pretty clear from these figures that the Bank of England scare stories around the impact of Brexit were, to put it kindly, inaccurate, and its decision to cut rates reckless,' says Mumford.
‘While the fall in sterling will ultimately hit retailers’ input costs, many will see the benefit from purchases from overseas customers now that online sales are becoming a growth feature of their business.’
Retail sales numbers were likely to have been improved by weather conditions, Mumford admits.
'More widely, and contrary to the doom-mongering, there’s every chance we could be on the cusp of a pretty good bull market,' adds Mumford.
'Historically, markets tend to get very cheap or very expensive before they turn, and the UK market is currently a long way from either point.
'Bonds and deposits are yielding next to nothing right now, and could actually end up costing investors money should the double whammy of a rising oil price and falling Sterling trigger a bout of inflation. There will simply be nowhere else for a lot of money to go but into riskier assets.'
Cyclical consumer stocks are trading higher on the back of the news, up 0.6% versus 0.2% gains on the FTSE 100.