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Shoppers delaying purchases until January sales boosted growth in UK retail spending last month, the latest sign of improved economic momentum after a weak end to last year.
The value of retail sales rose at an annual rate of 2.7 percent in January, up from 1.2 percent in December and above the 2025 average of 2.3 percent, according to data published Tuesday by the British Retail Consortium.
Helen Dickinson, chief executive of the British Retail Consortium, said: “A dreary December gave way to a bright January as retail sales rebounded.”
“Many shoppers had put off Christmas spending and were looking forward to January sales”, he said, adding that the month saw the biggest increase in in-store sales in more than six months.
The figures are the latest to show signs of improvement in January after a weak second half of 2025, when months of speculation over taxes ahead of the November budget weighed on sentiment and activity.
The S&P Purchasing Managers’ Index for services and manufacturing in January pointed to the fastest expansion of activity since August 2024. Lenders Nationwide and Halifax and property portal Rightmove reported a surge in house prices at the start of the year. According to research company GfK, consumer confidence increased for the second consecutive month in January.
BRC data collected with consultancy KPMG also showed that the value of sales growth was still below the annual inflation rate, which rose to 3.4 percent in December, although it was close to the Bank of England’s 2.9 percent inflation forecast for January.
Sales improved in most categories, with non-food spending increasing at an annualized rate of 1.7 percent last month, above the 12-month average of 1.1 percent. Food sales rose 3.8 percent, in line with the one-year average.
The BRC data was published ahead of official retail sales figures on February 21 and has been closely watched by economists as weak consumer spending has limited the UK economy’s recovery since the pandemic.
Linda Ellet, UK head of consumer, retail and leisure at KPMG, said January sales tempted consumers to spend more, with personal electronics, furniture, children’s clothing and toys the best performing categories.
“The year has started well for the retail sector with a welcome increase in sales,” he said.
