Retail sales slump unexpectedly in December - ONS

(Sharecast News) - UK retail sales fell at the fastest pace since the start of 2021, official data showed on Friday, missing analyst expectations. According to the Office for National Statistics, retail sales volumes declined 3.2%, reversing an upwardly revised 1.4% increase in November.

It was the largest monthly fall since January 2021, when much of the country was in lockdown. Most analysts had been expecting a 0.5% decline.

Year-on-year growth declined to 2.4% from 0.2% in November.

In the three months to December, sales fell 0.9% quarter-on-quarter.

Both food and non-food sales were affected. Non-food sales volumes fell 3.9%, from a 2.7% increase in November, while food store sales were down 3.1%.

Heather Bovill, deputy director for surveys and economic indicators at the ONS, said: "Following a strong November, retail sales plummeted in December with all types of outlets being hit.

"Food stores performed very poorly, with their steepest fall since May 2021 as early Christmas shopping led to slow December sales.

"Department stores, clothing shops and household goods retailers reported sluggish sales too as consumers spent less on Christmas gifts, but had also purchased earlier during Black Friday promotions, to help spread the cost."

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: "The golden quarter for retailers was tarnished by lingering consumer caution, but demand should pick up tangibly this year as households' real disposable incomes continue to recover."