Eurozone retail sales slip during key holiday period

(BRUSSELS) - Eurozone retail sales fell in the key run-up to Christmas, dropping 0.4 percent in December compared with November, the European Union's data agency said Friday.

The volume of retail trade was also 1.6 percent lower than in December 2010, Eurostat added.

Across the 27-state European Union as a whole, including the likes of Britain and Poland, sales rose however by 0.3 percent on the month, while falling by just 0.1 percent compared with the previous year.

Britain logged the biggest annual increase, of 6.3 percent, with Portugal and Spain logging the sharpest falls, of 8.8 percent and 5.3 percent respectively.

For London-based IHS Global Insight analyst Howard Archer, "the prospects for eurozone consumer spending still look far from promising."

He cited a cumulative rise in overall unemployment of 816,000 more jobless people since April 2011.

Archer said that even though inflation had begun to ease, muted wage growth and tighter fiscal policies posed "a serious threat to hopes that eurozone economic activity can return to growth in the first quarter of 2012."

December 2011 compared with November 2011 Volume of retail trade down by 0.4% in euro area Up by 0.3% in EU27 [Eurostat]