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UK retail sales fall sharply in December | UK retail sales fall sharply in December |
(about 1 hour later) | |
Retail sales in December dropped 1.9% from the previous month, according to official figures. | Retail sales in December dropped 1.9% from the previous month, according to official figures. |
Sales across all main retail sectors declined, with the heaviest falls coming at non-food stores, the Office for National Statistics (ONS) said. | |
It was the biggest monthly fall for more than four and a half years. | It was the biggest monthly fall for more than four and a half years. |
The Black Friday discounts in late November made it "even harder... to keep shoppers spending during December", analysts at Lloyds said. | |
Experts had predicted a much smaller 0.1% monthly fall. | |
'Tough 2017' | |
Retailers had a "disastrous December... much worse than expected," said Alan Clarke of Scotiabank. | |
Inflation figures earlier this week showed prices rose more than expected in December, "and now we also know that sales volumes fell", Mr Clarke said. | |
"This is likely to be the theme for the rest of the year - higher prices will reduce disposable income and hurt consumer spending growth," he added. | |
Martin Beck, senior economic adviser to the EY Item Club, said "the squeeze on households' real incomes is gradually tightening, implying a tough 2017 for retailers". | |
Clothing, footwear and household goods all saw "particularly sizeable drops" last month, he added. | |
However, when compared with a year ago, retail sales were up 4.3% in December. | |
"There were some notably strong figures from smaller retailers, in particular butchers, who reported a significant boost in sales in the run up to Christmas," said Kate Davies, ONS senior statistician. | "There were some notably strong figures from smaller retailers, in particular butchers, who reported a significant boost in sales in the run up to Christmas," said Kate Davies, ONS senior statistician. |
Shoppers also bought more online, spending about £1bn a week, which was 21.3% higher than in December 2015. | Shoppers also bought more online, spending about £1bn a week, which was 21.3% higher than in December 2015. |
Despite the disappointing December figures, "retailers shouldn't assume that they will lead to a bad January as well", said Keith Richardson, managing director of retail at Lloyds Bank Commercial Banking. | |
"Consumer spending held up - against expectations - after the EU referendum and it may do so again." | |
On Monday, Bank of England governor Mark Carney said household spending was still strong after the Brexit vote, but warned the UK economy was becoming overly reliant on consumer spending. |