British retail sales rose last month, buoyed by strong online sales, according to data from the Office for National Statistics (ONS).

The total volume of retail sales, which measures the quantity bought, rose by 0.4% in December, following falls of 0.1% in November. and 0.8% in October. This contributed to an overall decline of 0.3% in Q4 sales volumes as a whole compared to Q3.

Online trading also strengthened, with sales at internet retailers rising by 4.4% in December – the biggest rise since February last year – driven by strong demand for gold and silver as precious metal prices continue to boom.

Acorss Q4 as a whole, the amount spent online (value rather than volume) rose by 2.1% compared to Q3 and by 8.4% compared to Q4 year-on-year.

The ONS said the overall December figure meant sales volumes rose year-on-year as well, rising by 1.3% uplift – the biggest increase since 2021 – with growth across food and non-food stores, as well as non-store retailers.

Commenting on the figures, Harvir Dhillon, Economist at the British Retail Consortium, said: “ONS retail sales figures show a fragmented market over Christmas, with larger retailers seeing sales drop 1.6% while smaller independents grew 6.4%. Food sales remained relatively stable, but this was owing to rising food inflation rather than increased sales. Typically popular Christmas gifting categories such as electricals, books and health and beauty saw sales drop as people tightened their purse strings. Shoppers are continuing to hold back spending as they manage the rising cost of living.

“This performance capped off a difficult year, where significant cost pressures have been weighing down on the industry. If these costs continue to climb, whether through higher business rates bills or higher costs of employment, then it will be ordinary workers who are most affected as more entry-level and flexible jobs disappear. This means more people tightening their belts, and less spending in the economy in future.”

“December brought little festive cheer for retailers. Beneath flat headline numbers sits a distinctly K-shaped retail landscape, with Christmas exposing a widening divide in performance. Value-led players benefited from cautious consumer behaviour, while non-food felt the full force of fragile confidence,” added Nicholas Found, Head of Commercial Content at Retail Economics.

“Discretionary non-food categories faced a toxic mix of weak demand, lingering uncertainty following the late November Budget, and margin-eroding promotions. Many retailers were forced to discount earlier and harder to defend market share, putting profitability under strain,” Found said.

Looking ahead, Found noted: “Retail is becoming increasingly polarised – between businesses with sharp positioning, flexible operating models and a deep understanding of what customers value today, and those being left behind as the market reshapes around them.”