Statistics are a funny thing as they can misinform just as much as they inform. As David Brent in The Office said “Statistics are like a lamp-post to a drunken man - more for leaning on than illumination.”

Although as an economist I think this is a bit of an exaggeration but it is certainly true that statistics are not always as they seem. Nowhere is this truer than the economic statistics produced by the Office of National Statistics. I am not diminishing the efforts of the ONS, who in my opinion do a fantastic job and are far better than most other national statistical bodies in this world.

It is the interpretation of their statistics that leaves much to be desired. Commentators are all too willing to take monthly figures released by the ONS and other bodies and use them as direct evidence to support one theory, one forecast or one inclination. In fact monthly data is almost always revised in the following months as new evidence emerges. The monthly data is also highly sensitive to various events that occurred that month which are completely unrelated to the wider economic picture. Looking at longer term trends is a much more satisfactory way of interpreting data, even though they possibly lack the spontaneity that a new release provides.

Therefore I am going to comment upon the retail market in December, whilst attempting to avoid the trap of drawing a conclusion from just one month’s evidence.

I am writing this article before the official December retail sales figures have been released, which will be published next week. However given survey evidence and retailer announcements it is clear that the December figures are very likely to show sales increasing sharply compared to December 2008.

So clearly everything is getting better for retailers, right? People are flocking back to the shops and spending their money, right? A great Christmas on the high street is a sign of a great year ahead, right? Possibly, but probably not. As mentioned at the beginning of this article, don’t be misled by one month’s data.

It must be remembered that the sales data for December 2009 will be compared against the distinctly different retail environment of December 2008. This time last year it seemed for many that the world financial system was in free fall with unknown and possibly cataclysmic consequences. Christmas 2008 came very shortly after the collapse of both business and consumer confidence.

December 2008 followed months of sharp falls in retail sales, forcing the government to cut VAT to help stimulate demand. December 2009 came just before a VAT increase. The 2008 cut did not have as big an immediate impact because it provided a year’s window of lower prices, whereas in December 2009 people were rushing to take advantage before that window closed. Therefore when we see retail sales figures showing a large annual increase in month on month retail sales, this is overstating the strength of Christmas 2009.

This is not to be too downbeat. The signs are that December 2009 in itself was better than expected. Some of the retail sales figures released by major stores have seen higher growth than can be attributed just to a relative weakness in the previous year. It is indeed possible that some consumers have decided to spend some of the savings they have built up in the previous six months or took advantage of lower mortgage repayment costs, due to the cuts in interest rates by the Bank of England, to go out and enjoy Christmas.

One should however avoid euphoria. A large rise in sales is excellent but it must be seen in context of sharp falls of a similar magnitude in the previous year, as well as the possibility that temporary factors boosted sales this Christmas, whilst continued weakness of employment and wage growth could depress sales further through 2010.

An article released yesterday in the Financial Times shows the extent of the economic uncertainty that exists at the moment.

The paper sent a survey to leading UK economists asking broad questions about the outlook for the economy, employment, house prices, government spending etc.

The paper printed the responses from the various experts, and in typical economist fashion they came up with very different views for the economy.

For example, when asked whether 2009 would show the first "green shoots" of recovery in the economy, there was an almost even split between those answering yes and those answering no. Looking closer at the responses given the reasons for the responses were also very different.

Often the survey also seemed to suggest different interpretations of various economic terms led to different survey responses. For example, some respondents defined economic recovery as recording positive growth and others thought it meant seeing a return of trend growth. These are significantly different with the later being much harder to achieve.

This article has helped to confirm that we are entering a very uncertain time. I remain hopeful that we will see the first signs of recovery before the end of the year, but so much could happen to put this out of reach.

You may have to register with the FT web site (for free) but its worth having a read of this article.