Sales of luxury goods are poised to rise by 8% this year after reaching record levels in 2010, according to a report from corporate advisor Bain & Company.

Bain said the sector had been boosted by strong momentum in the US and Europe, as well as continued growth in China and other fast-growing markets, in the first quarter of the year.

The growth in markets such as Russia, Brazil and the Middle East is predicted to lead to total sales of luxury goods in 2011 of EUR185bn (US$265bn), Bain said in its Spring 2011 Update: Luxury Goods Worldwide Market Study.

Sales of luxury goods fell by EUR17bn in 2008 and 2009, but rebounded last year with stronger than expected holiday sales to reach EUR172bn, above the previous peak of EUR170bn in 2007.

“Luxury has made a brilliant return to the retail stage, but the script has been rewritten,” said Claudia D’Arpizio, a Bain partner in Milan and lead author of the study.

“More demanding customers, generational shifts, new loyalty rules, an increasingly integrated offline and digital customer experience and the continued growth of China and other fast-growing markets are transforming the luxury industry.”

Bain forecasts suggest the Americas will remain the world’s largest luxury goods market, with sales rising 8% this year.

Meanwhile, China will increase 25%, putting Greater China in position to overtake Japan for the first time; Europe will rise 7%, and Japan will decline by 5%, said Bain.