UK retail sales unexpectedly rose in December, driven by a surge in online jewellery purchases, according to official figures. The Office for National Statistics (ONS) reported a 0.4% increase in sales volumes compared with November, defying economists' forecasts of a 0.1% decline.
The rebound was largely fuelled by a 4.2% rise in online sales, with internet jewellers benefiting from heightened demand for gold and silver. Gold prices have approached $5,000 per ounce amid global economic uncertainty, boosting the precious metal's appeal as a safe-haven investment. Non-food stores, including department and clothing shops, saw a 0.9% drop, while supermarkets and fuel sales edged up.
Despite the December uptick, the final quarter of 2025—the crucial 'golden quarter' for retailers—saw sales fall 0.3% compared with the previous three months. Annual retail sales rose 1.3% in 2025, a second consecutive increase, but remain about 2% below pre-pandemic levels from 2019.
Consumer confidence rose to its highest since August 2024, according to a GfK survey, as households grew more positive about their finances. Economists suggested the impact of Chancellor Rachel Reeves's November budget tax hikes was less severe than feared, with most increases not taking effect until later in the parliament.
Hannah Finselbach, ONS senior statistician, noted that supermarkets and online stores were down over the three-month period, but December saw a boost from internet jewellers. Martin Beck, chief economist at WPI Strategy, cautioned that sales still highlight ongoing pressures from high living costs and fragile consumer confidence.
