London, Aug l (BridgeNews) - Retail sales growth picked-up in July, with year-on-year growth rising at its fastest rate since May 2000, the latest Confederation of British Industry distributive trades survey showed. The survey highlighted the continuing strength of U.K. consumer demand, with three month sales average hitting its highest level since February 2000. * * * In all, a net 44% of respondents reported sales volumes were up in July compared to the same month a year ago. This was sharply up on the net 30% reporting higher sales in June. Retailers were slightly less optimistic, however, that this growth rate would be maintained, with a net 37% saying they expected August sales to rise on a year ago. The 3-month moving average for sales volumes climbed to a net 36%, up from 32% in June. The CBI said the pick-up in the pace of retail sales volume growth was "unexpected" and it noted that wholesalers also saw sales rise in July. The CBI's data was issued on the same day the Chartered Institute of Purchasing and Supply published its monthly manufacturing survey, showing the manufacturing sector continuing to contract. The CBI has called on the Bank of England's Monetary Policy Committee to cut rates this week, in light of manufacturing weakness, but its own retail survey appears to have undermined its case. "With retail sales at their strongest since the Millennium, the CBI's call for a quarter point cut in interest rates is staggering," Ross Walker, U.K. economist at Royal Bank of Scotland said. The MPC is widely expected to leave rates on hold at 5.25% when it announces its decision Thursday, and the CBI survey will add to this belief. The CBI survey covered sales from covered 164 retailers and a total of 275 respondents in distributive trades.