December retail figures – UK consumer catches a cold

The Office for National Statistics has reported retail sales figures in Great Britain for December:

• Retail sales volumes are estimated to have fallen by 3.2% in December 2023 following a rise of 1.4% in November.
• Non-food store sales volumes fell by 3.9% in December 2023.
• Clothing stores sales volumes fell by 1.5% in December 2023.
• Compared with the same period a year earlier, retail sales volumes fell by 0.9% in the three months to December 2023.

Charlie Huggins, Manager of the Quality Shares Portfolio at Wealth Club commented:

“Retail sales volumes ended the year on a sour note, registering the largest monthly decline since January 2021.

Partly, this is because UK consumers did their Christmas shopping early this year. Nevertheless, December’s decrease was much worse than expected and suggests pressure on the UK consumer may be intensifying.

Results from retailers themselves over Christmas paint a very mixed picture. The supermarkets fared reasonably well, as did Next and M&S. But sales from the likes of JD Sports and Superdry have been very disappointing. This suggests UK consumers are becoming more choosy about where to spend their money.

Whether December’s weak retail sales are a blip or the start of a more worrying trend remains to be seen. But one thing’s for sure  – despite optimism around interest rate cuts, the UK economy certainly isn’t out of the woods.”