UK retail sales increased by 0.3% in December – much lower than the 1.2% rise expected by economists.
New figures from the Office for National Statistics also showed that despite an online boom, retail sales fell 0.4% in the fourth quarter.
Looking at 2020 as a whole, online sales boomed and hit record highs, however, retail sales in total fell 1.9% compared to 2019. This is the biggest yearly drop on record.
Over 2020, clothing sales were down 25.1%, petrol stations were down 22.2% and department stores fell 5.2%. Online sales and mail order sales saw a record increase of 32% over 2020.
Internet sales at food stores shot up 79.3%, department stores were up 65.9% and household goods stores up 73.4%.
“December’s retail sales increased slightly, driven by an improved month for clothing sales, as the easing of some lockdown measures for parts of the month meant more stores were able to open,” said Jonathan Athow, deputy national statistician for Economic Statistics. “Food store sales this month were subdued as retailers reported lockdowns and restrictions on the sale of non-essential items impacted on footfall. “
“Retail sales for 2020 saw their largest annual fall in history as the impact of the pandemic took its toll. Clothing retailers fared particularly badly, with a record annual fall of over 25%, while movement restrictions led to a record year-on-year decline for fuel sales.
“Some sectors were able to buck the trend in 2020. The increased popularity of click and collect and people buying more items from home led to a strong year for overall internet sales, with record highs for food and household goods sales online,” he added.
In separate news, government borrowing continues at a record pace. In December, the government borrowed £34.1bn.
Paul Craig, portfolio manager at Quilter Investors, commented: “With Brexit concluded, albeit rather weakly, and the vaccine rollout well underway, Rishi Sunak may be receiving the message from the backbenchers that the time is right to bring the borrowing under control.”