High street retail enjoys surprise December gain

Black Friday frenzy failed to eclipse the Christmas rush. Picture: Contributed

A rise of 0.4 per cent marked the weakest December growth for two years but beat City expectations that the figure would be lower due to the US-imported sales phenomenon dragging forward many pre-festive purchases into November. Year-on-year growth was 4.3 per cent, according to the Office for National Statistics (ONS) data.

December’s volume growth was driven by supermarket sales and an increase in motorists filling up their tanks thanks to cheaper petrol.

However, department stores suffered from Black Friday as online sales fell year-on-year for the first time since records began at the start of 2008.

David Kern, chief economist at the British Chambers of Commerce, welcomed the overall rise in sales but said the economy was too reliant on high street spending.

SUBSCRIBE TO THE SCOTSMAN’S BUSINESS BRIEFING

• Get the latest business headlines from a variety of news sources emailed to your inbox each morning

“While it is positive the retail sector is performing well, the UK still relies too heavily on consumer spending, and the contribution of exports and investment remain too low,” he said. “Our view that interest rates will have to stay at their current low level at least until the first half of 2016 is now widely accepted. But low rates are not enough – we must focus on boosting exports and investment to drive forward economic recovery.”

The ONS data was skewed by the fact Black Friday sales were included in November’s figures for 2014 but were recorded within December’s numbers the year before.

But underlying figures comparing sales in the last quarter with the same period in 2013 showed the best growth in a decade, with the 5 per cent rise the best since November 2004.

Average prices were 2.2 per cent lower last month on December 2013, the largest fall since June 2002, largely as a result of plunging petrol prices.