UK retail sales fell sharply in December as Omicron spread

UK retail sales fell much more than expected in December as rising Covid-19 infections and new restrictions affected consumers’ spending on fuel, clothing and sports equipment.

The volume of monthly retail sales in the UK fell by 3.7% between November and December, according to the Office for National Statistics.

This was a much larger contraction than the 0.6% forecast of economists polled by Reuters. It followed strong growth in November, when early Christmas shopping boosted sales.

UK line chart, volume, 2019 = 100, showing a decline in retail sales in December

“After a strong pre-Christmas trade in November, retail sales fell in December, with feedback from retailers suggesting Omicron had an impact on proliferation,” said Heather Boville, ONS deputy director of research and economic performance.

Sales in non-food stores fell by 7.1% in December 2021, declining in all types of stores. Fashion and sports equipment stores saw a sharp drop of about 8 percent. Department store sales fell 6 percent, while furniture stores saw a 3 percent drop. Sales in grocery stores also fell.

“As the restrictions on Plan B in England meant more people working from home, there was a noticeable drop in fuel sales,” she added.

Gasoline sales fell 4.7% as many people worked from home and had to isolate themselves or avoid traveling after infections increased. Sales in grocery stores fell by 1%.

Despite the decline in December, retail sales were 2.6% higher than in February 2020, before the first restrictions on Covid-19.

“Despite the decline in December, however, retail sales are still stronger than before the pandemic, with more than a quarter of sales already online.

Some data released on Friday by research firm GfK showed that consumer confidence fell to its lowest level since February 2021 in January, amid worries about rising living costs and rising energy bills.

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