Reacting to the official retail sales figures from the Office for National Statistics (ONS), the British Retail Consortium (BRC) said the official data paints too pessimistic a picture of December trading.
Richard Lim, British Retail Consortium economist, said: “The figures are right to show December sales values were up on a year ago. Customers clearly felt more confident about spending than they have for some time. Sales growth was also helped by the VAT cut dropping out of the 12-month comparison, December being the first and only month where the 15% rate is the same as a year earlier.
“But these ONS sales figures paint a more pessimistic picture than we would have expected. ONS’s figure of 2.6% for annual growth in sales values is less than half the 6% result in our own Retail Sales Monitor, published last week.
“It’s also at odds with a spate of company trading results since Christmas that show December sales well up on the previous year – with some retailers even recording double digit growth.”
Richard Lowe, head of retail and wholesale, Barclays said: “Although these figures came in lower than expectations, the general feeling is that 2009 ended on a relatively high note for retailers.
“Christmas trading proved positive as consumers upped their purchasing, releasing some of the pent-up demand in the market. The majority of trading updates at the end of 2009 were also positive, offering some cheer to the sector as the year ended.
“Margin management and tighter stock control made for a quick and very efficient sales period. Discounting was far less widespread than the previous year, leaving successful retailers with their margins as anticipated entering 2010.
“Retailers will look to the start of the New Year with an air of cautious optimism. They will be encouraged by some momentum from December, although it remains to be seen to what extent the reinstating of VAT at 17.5% will have displaced demand from the early months of this year, particularly for household goods.
“The industry will hold its breath for any changes brought-on following the election, and will hope for good results from major trading moments until then, such as Valentine’s Day and Easter.”
