A dash by consumers to buy a computer game that simulates stealing cars helped to shore up high street trading last month, limiting the scale of the first back-to-back monthly drop in sales for more than two years.

Booming sales of Grand Theft Auto IV and a fitness-based game, Wii Fit, buoyed trading at nonfood stores and offset a drop in the amount of food sold in April, as financially stretched households curbed spending in reaction to rising bills at supermarket check-outs, the Office for National Statistics (ONS) said.

Despite the hefty boost from the two hit titles for games fanatics, the overall volume of goods sold on the high street still fell last month by 0.2 per cent, matching a similarly modest drop in March, in the latest sign that cash-strapped consumers are starting to retreat from the shops.

The decline in sales over the past months marked the first such back-to-back monthly falls in trading volumes since January 2006, the official figures showed.

April’s slide in sales volumes was not as severe as economists had expected, however, and sowed further confusion over the scale of the slow-down in consumer demand.

With house prices falling, and shoppers facing a growing squeeze from rising food and fuel bills, a heavy burden of personal debt and weak income growth, consumer sentiment is wilting and most experts believe that spending is already weakening substantially.

High street surveys from both the British Retail Consortium and the CBI, as well as by the Bank of England’s regional agents, back the City’s belief that consumer demand is faltering badly. But the Bank and economists have been left puzzled by official sales data, such as yesterday’s that remains markedly stronger.

The Bank has said that it is placing substantial weight on the survey-based signals that the consumer is in retreat, and economists continued yesterday to question the accuracy of the more upbeat official figures.

Among question marks raised over the official numbers are the large scale of statistical adjustments to strip out seasonal trading patterns, which can cause big distortions, and the large price falls shown in the ONS data.

Michael Saunders, of Citigroup, noted that, despite strong inflationary pressures, the official data showed goods prices down by 1.2 per cent year-on-year. Lower prices mean that when the value of sales is converted into volume of goods sold, the figures are flattered, leaving Mr Saunders to fret that if price falls for goods are exaggerated, the official sales figures could be given an upward bias. The true state of high street conditions was further clouded as Mothercare defied economic gloom to report a 70.8 per cent rise in its full-year profits.

Debenhams also said that, although clothing retailers had struggled amid bleak April weather, a brighter May had heralded a change in fortunes. Angela Spindler, the department store chain’s managing director, said: “We have just had a fantastic week.” Woolworths underlined the squeeze on consumer spending power, however. It said that customers were searching for bargains and that it would cut price tags on 1,000 products by up to 16 per cent.

Heightened uncertainty over the outlook for consumer demand reinforced City expectations that interest rate cuts are off the Bank of England’s agenda for the summer at least after its warnings last week over mounting inflationary dangers.

The Bank’s inflation anxieties will be reinforced after a key CBI survey yesterday showed that manufacturers are expecting to raise their prices in coming months at the fastest pace for 12 years as their costs spiral.

Plans by manufacturers to raise prices for goods leaving factories came despite a second consecutive monthly fall in their orders shown by the CBI figures, with industrial companies also now expecting no growth in their output in coming months.

The Bank’s dilemma over the grim combination of rising price pressures with vulnerable growth was made yet worse, however, by separate official data showing that business investment suffered its first fall since the end of 2005 in the first quarter.

Grand success

— Grand Theft Auto IV broke records for a computer game on its first day in the shops at the end of April, shifting more than 600,000 copies worth £25 million

— The previous record holder was its predecessor, Grand Theft Auto: San Andreas, released in 2004

— Wii Fit, where players simulate exercise with their Nintendo Wii games console, sold 240,000 in its first two days, generating about £17 million

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