How sales increased by 11.9 per cent in January this year

The British Retail Consortium (BRC)-KPMG Retail Sales Monitor also showed that the total sales figure was above the three month average growth of 6 per cent and the 12-month average growth of 10.9 per cent.

UK retail sales increased 8.1 per cent on a like-for-like basis from January 2021.

Helen Dickinson OBE, chief executive of the BRC, said: “It is encouraging to see such strong sales in January, even once inflation has been accounted for.

“Food sales were more muted than in previous months, as people went back to eating out more often.

“Consumers prioritised home purchases, boosting the sale of household appliances, electronics and homeware. In what may be signs of a return to pre-pandemic trends, furniture was the stand-out performer in January, after transport delays in the Christmas period began to ease.

“Retailers and consumers face challenges in the coming months. Retailers face competition from other spending opportunities as the public flood back to restaurants, cafes and live events.

“Furthermore, rising inflation, driven by higher costs of production, higher energy and transport prices, as well as other looming price hikes this Spring will mean consumers will have to tighten their purse strings.”

Over the three months to January, food sales decreased 0.1 per cent on a total basis and 0.5 per cent on a like-for-like basis.

Non-food retail sales, over the same period, increased by 11.1 per cent on a total basis and by 6.5 per cent on a like-for-like basis.

Paul Martin, UK head of retail at KPMG, said: “Retailers will be relieved that we started the year without further lockdowns as consumer demand continued strongly on the high street with sales up 11.9 per cent on last year.

“However, this unusually strong performance for January, which is traditionally a slower month, should be put in the context of last year’s lockdown restrictions.

“Footwear, furniture and jewellery saw strong sales growth in stores whilst spending on food and drink, toys and computing all fell during January.

“Unsurprisingly, online sales were down across all categories compared to January 2021, with items for the home seeing the biggest fall in sales volumes.

“With Covid restrictions now eased, and people heading back to workplaces, retailers will be hoping consumer confidence remains robust to help offset the rising cost challenges that they are likely to experience for a while.

“We could see a challenging few months ahead if wider macroeconomic conditions start to squeeze household incomes to the point that they start cutting back on retail spending.

“Retailers are facing their own inflationary pressures and will need to take tough decisions on whether and how to pass on the increased costs they have been sitting on for some time to consumers facing their own financial challenges.

“We could easily see the health of the sector start to deteriorate if consumers choose to sit on savings to weather the storm.”

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James Mitchinson