Retail sales beat expectations in January

Retail sales rose more than expected in January as shoppers loosened their purse strings after the general election result reduced near-term uncertainty, official figures indicated.

Retail volumes rose 0.9% from December boosted mainly by food sales, the Office for National Statistics said. The average economist's forecast was for a 0.7% increase.

In the three months to January retail purchases fell 0.8% from the previous period with declines across all sectors. The three-month figures include the whole of the Christmas and post-Christmas trading period but the January result appears to reflect a short-term boost caused by the Conservatives' emphatic election victory in December, which allowed Brexit to pass.

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said the January figure showed retail snapping back after politics-related weakness in the fourth quarter of 2019. Food store sales rose 1.7%, non-food store sales were up 1.3% and non-store sales rose 2.5%. Petrol sales fell 5.7%.

"January’s official retail sales figures confirm that the decisive general election has released the handbrake of political uncertainty on consumers’ spending," Tombs said.