- KPMG
Retail trade in the United Kingdom was quite weak throughout the last month of 2015 when the gauge is traditionally expected to pick up due to Christmas holidays. Nonetheless, this December was a disappointing month for British retailers who saw a 1% drop in overall sales on a monthly basis. Such a sharp percentage change, however, followed a revised 1.3% advance a month earlier, meaning last month's development was largely a correction towards the norm. Clothing and footwear stores took the steepest hit in December, with two main reasons of that being warmer than usually weather and floods that held consumers away from stores. On top of that, analysts are warning that more people are now shopping at online stores, thus decreasing the role of traditional supermarkets. Along with retail sales, Friday data included latest numbers on UK public sector borrowing. Public finances in the second largest economy of Europe improved in December due to a boost from much better tax receipts. Deficit excluding banking sector plunged to 7.5 billion pounds last month, down from 12.9 billion pounds in November and 12.5 billion pounds in December 2014. Even though there are three months to go until the current UK financial year end in March, public sector year-to-date net borrowing has already surpassed the government's target of 68.9 billion pounds, by reaching 74.2 billion pounds. However, January usually is a surplus month, which can improve the overall situation quite considerably.
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