The holiday season failed to provide the widely expected boost to Italy’s retail sector at the end of the year.

Retail sales in the eurozone’s third largest economy fell 0.5 per cent in December, Italian stats agency Istat said, confounding expectations of a 0.2 per cent rise compared with the previous month.

On an annual basis, Italy’s retail sales did a lot worse than expected, falling 0.2 per cent against expectations of a 0.9 per cent rise in December that would have built on November’s 0.8 per cent annualised gain.

Figures yesterday showed that Italy emerged from its first year of outright deflation in nearly 70 years to post its highest inflation rate since 2013 in January at 0.7 per cent on an annual basis.

Separate figures earlier this month showed the country notched up its best annual economic growth since 2010, at 0.9 per cent in 2016, up from 0.73 per cent the previous year.

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