By Jonathan Davies

UK retail sales fell 0.3% between December and January, according to the Office for National Statistics (ONS).

It follows a 0.2% rise between November and December, but sales were particularly strong in January when you look at how things were last year. Retail sales were 5.4% higher than in January 2014.

The ONS said high street stores dropped their prices in an attempt to lure customers. Average prices were down 3.1%, the figures revealed. It is the largest annual fall in prices since consistent records began in 1997.

There was particularly strong growth in online sales, which grew by 12%.

"The prospects for retail sales and consumer spending overall for 2015 currently look bright, given significantly improving real earnings growth, rising employment and elevated confidence," said Howard Archer, chief European and UK economist at IHS Global Insight.

"Furthermore, it now looks highly possible that interest rates will not rise until 2016."

Lloyds Bank retail managing director Keith Richardson said: "As retailers try to get back to normal after several months of promotions-driven sales, the message from shoppers is clear: heavy discounts are the new norm."

Mr Richardson added: "Retailers and consumers have overdosed on a diet of Black Friday, Boxing Day and early January sales. They are due a hangover."