Eurozone retail sales beat expectations at the start of the year, as consumers in Portugal and Poland loosened their purse strings. But the rate of growth slowed compared to the previous month.

In January, retail sales grew 0.4 per cent on the month, compared with expectations of 0.1 per cent growth. However, the rate of growth slowed from a revised 0.6 per cent growth rate in December.

The highest increases in retail sales came from Portugal (5.9 per cent), Poland (3.4 per ent) and Slovenia (3.0 per cent), while the largest decreases were seen in Luxembourg (minus 1.2 per cent), Austria and Slovakia (both minus 1.1 per cent).

Year-on-year retail sales expanded 2.0 per cent, a marginal decline from the revised 2.1 per cent growth in December, but above expectations of 1.3 per cent.

The news comes as a welcome surprise for the eurozone economy, as the European Commission recently said consumer confidence decreased sharply in the single currency zone in February.

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