Ian McConnell
RETAIL sales in Great Britain tumbled unexpectedly in the crucial December trading period, as consumers reined in festive spending amid Brexit uncertainty, and have now recorded their longest period without growth since records began in 1996.
The Office for National Statistics said yesterday that retail sales volumes dropped by 0.6 per cent month-on-month on a seasonally adjusted basis in December, having fallen by 0.8% in November. The figures were much weaker than expected, with the median forecast among economists having been for a 0.5% rise. The data fuelled speculation that the Bank of England’s Monetary Policy Committee could vote for a quarter-point cut in UK base rates from 0.75% as early as its January 30 meeting.
Comparing the fourth quarter with the preceding three months, retail sales volumes were down 1%. This was the worst three-month-on-three-month movement since early 2017.
Howard Archer, chief economic adviser to the EY ITEM Club think-tank, observed retail sales volumes had now either fallen or been flat in five consecutive months and highlighted the fact this was the longest run without growth since comparable records began.
Mr Archer said: “There had been speculation the November performance had been adversely affected by the relatively late Black Friday, and that this would be reflected in a bounce-back in December but this was clearly not the case and consumers were reluctant to spend over the crucial Christmas period.”
He added: “It is clear that consumers adopted a more cautious approach over the fourth quarter amid heightened domestic political, economic and Brexit uncertainties.”
Retail sales volumes in December were up by just 0.9% on a year earlier, the ONS figures showed.
A survey published earlier this week showed Scottish retailers endured a “bleak midwinter” with a year-on-year fall in sales over the key two-month festive trading period. The Scottish Retail Consortium’s latest monitor showed that, taking November and December together, the total value of sales was down by 0.9% on the same period of 2018.
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