Retail sales in the UK bounced back in December with a better-than-expected performance over the Christmas season, according to new figures.
The total volume of retail sales, which measures the quantity bought, increased by 0.4% last month, said the Office for National Statistics (ONS).
While the rise is small, it’s well above the 0.1% drop forecast by economists polled by the Reuters news agency.
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The figures are a positive sign for retailers, who can often rely on trading during the key Christmas month to fund operations for the rest of the year.
It comes after an online trading boost, with sales across internet retailers rising by 4.4% – the biggest rise since last February – thanks to strong demand for gold and silver after a lull in November.
Retail sales figures matter as they measure household consumption, the largest expenditure in the UK economy.
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Growing retail sales can mean economic growth, which the government has repeatedly said is its top priority.
The latest figures hint that consumers may have shaken off their pre-budget worries.
The late date of the budget (26 November) and speculation over its content had contributed to the economy contracting in October, the ONS said.
Why the rise in sales?
Part of the latest retail sales increase was down to demand for metals like gold and silver from online jewellers, the ONS said.
The price of both materials reached record highs during December, meaning it was more expensive to buy than before.
A similar trend of people looking to buy gold was seen in September. Investors tend to move money out of shares and into perceived safe-haven investments, like gold, amid political and international uncertainty.
As many department stores noted, the official figures showed there was a big drop-off in people buying household goods.
Consumers did, however, turn in big numbers to online shops, street stalls and markets. Sales in these so-called “non-store retailers” rose 4.2% last month, the figures show.
The bigger picture
Across the 12 months to December, retail sales also defied expectations, rising 2.5%. Only a 1.1% increase had been expected by the Reuters poll of economists.
But when looked at on a three-monthly basis, from October to December, the period described as the golden quarter for retailers, there was a 0.3% contraction compared to the previous three months.
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The prior three months, from July to September, had been strong for the shops due to good weather and the UEFA Women’s Euros.
For 2025 as a whole, sales volumes remained below pre-COVID pandemic levels, having not fully recovered from a 2023 fall, when there was double-digit inflation.
