Demand for online jewellery boosts December retail sales

The demand for online jewellery played a significant role in boosting retail sales in December, despite a challenging festive period for retailers. According to figures from the Office for National Statistics (ONS), sales saw a 0.4% increase from the previous month, with online jewellers reporting a surge in demand for precious metals like gold and silver.

While internet shopping performed well, there was also a slight uptick in sales for supermarkets and automotive fuel. However, non-food retailers such as department stores, clothing shops, and household stores experienced a 0.9% decrease in sales.

The unexpected monthly rise in December followed a decline in sales in November, despite the presence of Black Friday promotions. Retail sales had fallen by 0.1% in November and by 0.8% in October.

Although monthly growth rates can be volatile, ONS noted that sales volumes dropped by 0.3% in the final quarter of the year compared to the previous quarter, with both supermarkets and online stores witnessing a decline.

The festive season is a crucial period for retailers, as it typically accounts for a significant portion of their annual sales and profits. Overall, retail sales in 2025 were up by 1.3%, with stronger performances from both food and non-food stores, as well as non-store retailers like online sellers and street markets.

Despite the consecutive annual rise in sales, they still remain below pre-coronavirus pandemic levels from 2019. ONS senior statistician Hannah Finselbach highlighted that while retail sales saw a slight drop in the last quarter of the year, December saw an increase, driven by the strong performance of internet retailing. Online jewellers, in particular, reported higher demand for gold and silver during the month.

The rising cost of living has put pressure on shoppers’ budgets, with businesses facing higher costs following recent Budget announcements. Nicholas Hyett, investment manager at Wealth Club, noted that the latest figures indicated a lack of festive cheer on the high street, as more Christmas shoppers opted for online purchases.

In uncertain times, shoppers seem to be gravitating towards dual-purpose jewels that not only serve as Christmas gifts but also offer a long-term store of value. Precious metals like gold and silver are considered safer assets during times of uncertainty, and their prices have surged over the past year.

While the modest monthly rise in UK retail sales in December brought some relief after a challenging autumn, it was not sufficient to drive significant growth. Alice Cowley, managing director at Accenture’s retail practice, highlighted that despite the boost from food, discounts, and holiday preparations, the sector did not experience substantial growth during the crucial Christmas period.

Consumer confidence remains subdued, with GfK’s latest consumer confidence index showing a marginal increase in January. Capital Economics expects consumer spending to remain relatively weak in the coming year, citing factors like weak employment and slower wage growth as barriers to significant growth.

In conclusion, while online jewellery sales helped drive retail sales in December, the overall retail sector continues to face challenges amidst ongoing economic uncertainties. The shift towards online shopping and the demand for precious metals reflect changing consumer preferences and spending habits in the current landscape.