Retail sales show sharpest annual fall on record


By Ian McConnell

RETAIL sales volumes in Great Britain rose much less than expected in the key festive trading month of December and, over 2020, showed a 1.9 per cent drop which was the worst annual fall since records began in 1997.

The 0.3% rise in retail sales volumes last month on a seasonally adjusted basis, reported yesterday by the Office for National Statistics, was way adrift of the consensus forecast among economists of a 1.2% increase. A sharp rise in December had been anticipated because sales in November were depressed significantly by the English lockdown which started on November 5 and ran until early last month.

Non-essential shops across central Scotland were closed in late November and early December amid coronavirus-related restrictions. They then reopened, before a move to lockdown on the Scottish mainland after Christmas.

Retail sales in Great Britain had dropped 4.1% month-on-month in November, amid the restrictions put in place to slow the spread of Covid-19. Clothing sales volumes jumped 21.5% month-on-month in December, having seen a 19.6% drop in November.

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Overall retail sales volumes in December were up 2.9% on the same month of last year. The non-store category, which takes in online retail sales, recorded a 43.5% year-on-year rise in volumes in December. Food stores recorded a 4.4% year-on-year rise in sales volumes last month.

Comparing the fourth quarter with the prior three months, retail sales volumes were down 0.4%. The EY ITEM Club think-tank said this was consistent with its view the UK economy “likely stagnated over the quarter, just avoiding contraction”.

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It added: “After Q1, the EY ITEM Club expects the economy to benefit progressively through 2021 from the roll-out of Covid-19 vaccines. Consumers look well-placed to play a key role in a pick-up in the UK economy from the second quarter given the recent high savings ratios, although much will depend on unemployment numbers.”


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