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UK retail sales slide after Black Friday boost
[LONDON] British retail sales slid 1.5 per cent in December from the previous month after consumers had brought forward their Christmas shopping owing to Black Friday deals, official data showed Friday.
It was the biggest monthly fall since June 2016 and larger than analysts' consensus forecast for a drop of 1.1 per cent.
Retail sales had jumped by 1.0 per cent in November, boosted by Black Friday price reductions, the Office for National Statistics said.
Sales though climbed 1.4 per cent in December compared with one year earlier, the ONS added.
"Retail sales continued to grow in the last three months of the year partly due to Black Friday deals boosting spending," said ONS Senior Statistician Rhian Murphy.
"Consumers continue to move Christmas purchases earlier, with higher spending in November and lower spending in December than seen in previous years." Ms Murphy added that "the longer-term picture is one of slowing growth, with increased prices squeezing people's spending".
Britons' wages have eroded by Brexit-fuelled inflation, according to recent official data.
Since Britain voted to leave the European Union in June 2016, a drop in sterling - making imported goods more expensive - has caused UK inflation to hit a near six-year high before easing slightly.
"December's retail sales figures were pretty disappointing," concluded Ruth Gregory, UK economist at Capital Economics research group.
"But some fall-back had always looked likely, given November's hefty rise. And with inflation likely to have now peaked, the worst of the real pay squeeze should have passed, paving the way for a recovery in real spending growth this year," she added.
Britain's annual inflation rate hit 3.0 per cent in December, down slightly from a multi-year high of 3.1 per cent in November, partly owing to a fall in the price of toys before Christmas, official data showed Tuesday.
In response to last year's high inflation, the Bank of England raised its main interest rate in November for the first time in a decade - to 0.5 per cent from a record-low 0.25 per cent.
"The increase in interest rates in November which fed through to higher mortgage payments for those on variable mortgages in December may also have had a dampening effect with consumers having less disposable income to spend or save," Richard Stone, chief executive of The Share Centre, wrote on Friday.
Separate recent data showed that while supermarkets including Britain's biggest retailer Tesco did well over the Christmas trading period, some major clothing chains struggled.