BCC: Retail sales up, but UK too reliant on consumer spending

  • Retail sales volumes in December 2014, up 0.4% on the month and 4.3% on the year.
  • Average store prices fell by 2.2% in December 2014 compared with December 2013, the largest fall since June 2002.

Commenting on the latest retail sales figures for December 2014 published today by the ONS, David Kern, Chief Economist at the British Chambers of Commerce said:

“Although retail sales slowed down in December, the long-term trends show continued expansion with annual growth in sales volumes in excess of 4%. While it is positive that the retail sector is performing well, the UK economy still relies too heavily on consumer spending, and the contribution of exports and investment remain too low.

“The further declines in store prices, which largely reflect falling petrol prices, reinforce the likelihood that consumer prices will stay below 1% over the next few months. Our view that interest rates will have to stay at their current low level at least until the first half of 2016 is now widely accepted. But low interest rates are not enough – we must focus on boosting exports and investment if we are to drive forward economic recovery.”