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Weak retail sales over Christmas Weak retail sales over Christmas
(10 minutes later)
Consumers reined in their Christmas spending last year, according to official figures.Consumers reined in their Christmas spending last year, according to official figures.
Retail sales for the last three months of 2007 were 3.6% above their level for the same period of 2006, which is the weakest growth for more than a year. UK retail sales unexpectedly fell 0.4% in December compared with November, the Office for National Statistics said.
General mixed retailers, which includes department stores, had their worst December for 13 years, the Office for National Statistics said. The figure for the last three months of 2007 rose 0.4% compared with the previous three months, which is down from 1.0% growth in November.
The monthly retail sales figure fell unexpectedly by 0.4% from November. The figures are likely to boost expectations of another cut in interest rates from the Bank of England.
"Surely this is enough to cement a February rate cut and more cuts thereafter," said Vicky Redwood at Capital Economics.
General mixed retailers, which includes department stores, had their worst December for 13 years.
The fall in sales volumes came despite heavy discounting.
"A sixth successive month of significant discounting in December indicates that retailers believe that there is an increasing need to offer incentives for consumers to shop and are becoming less confident in their pricing power," said Howard Archer at Global Insight.