LONDON (AP) — Official figures show that retail sales in Britain sank in the holiday shopping month of December as higher prices squeeze consumers’ spending power.
The Office for National Statistics said Friday that retail sales fell by 1.5 percent in December from the month before, double what most economists were predicting.
December is important to the bottom line of retailers as well as to the wider economy, and the downturn suggests consumers took a more cautious approach to spending with inflation running higher than wage increases.
Household incomes have been depressed over the past year as inflation spiked following the pound’s fall in the wake of Britain’s vote to leave the European Union, which raised the cost of imported goods. Meanwhile, wage rises remain relatively depressed despite multi-decade lows in unemployment.