Retail sales beat expectations in January, as shoppers seized on New-Year deals despite a wider slowdown in spending amid political uncertainty.
According to new Office for National Statistics (ONS) figures which buck a recent trend of gloomy retail surveys, month-to-month sales volumes in the sector climbed one per cent during January, trumping consensus estimates of a 0.2 per cent rise.
Year-over-year growth also increased to 4.2 per cent, rising from 3.1 per cent in December and coming in higher than the consensus 3.4 per cent.
Experts at Pantheon Macroeconomics say that the figures suggest that shoppers opted a “happy-go-lucky mentality, despite the fraught political situation”.
The news comes in spite of growing fears for much of Britain's retail sector, with high street giants coming under pressure from mounting costs and increased competition from online rivals.
“It is notable that consumers seem to be timing their purchases to get the best value. Both January and November saw spikes in sales volumes, buoyed by the clearance sales in January and Black Friday discounts in November,” according to Howard Archer, chief economic advisor at the EY ITEM club
However, he added: “Despite January’s spike, a major concern for retailers will be that cautious consumers limit their spending in the near term at least due to the heightened uncertainties over Brexit. The GfK consumer confidence index remained at the lowest level since mid-2013 in January. Consistent with this, lenders expect demand for unsecured consumer credit to fall in the first quarter of 2019 at the fastest rate since records began in 2007 according to the latest Bank of England credit conditions survey.”