Retail sales fell steeply in March owing to a slump in petrol sales when the “beast from the east” hit Britain.

Volume of sales fell 1.2% in March from February, with petrol sales down 7.4%, the Office for National Statistics said. The ONS blamed the slump on the cold spell, when large parts of the UK were brought to a standstill by heavy snow and bitter cold weather. Analysts had been expecting a decline of 0.5%.

Sales were down 0.5% between January and March compared with the previous quarter, the worst performance in a year.

Rhian Murphy, ONS senior statistician, said: “Retail sales fell in the first quarter due to a large decline in March with petrol sales seeing a significant slump as a result of the poor weather keeping many shoppers indoors. However, the snow actually helped boost online spending with department stores in particular seeing growth in their web sales.

“Various shops also reported increased spending on gifts in the run-up to Easter and Mother’s Day, which also helped boost online sales.”

The department store sector was the only one to enjoy sales growth in March at 0.8%. Online offers for Mother’s Day and Easter led to greater internet sales than usual during the cold wave, the ONS said.

Food stores and non-food stores both posted declines of 0.6% last month. Within food stores, supermarket sales fell while specialist food stores such as butchers, bakers, fishmongers and convenience stores posted strong growth as they were easier to get to during the snow.

Clothing retailers experienced a 0.7% fall. Sales in household goods stores slipped 0.2% while those in other stores such as jewellers and bookshops dropped 1.8%.

The forecasting group EY Item Club said the figures suggested GDP growth slowed to 0.3% at best in the first quarter of this year, and could well have been as low as 0.2%. But it believes this is unlikely to deter the Bank of England from raising interest rates from 0.5% to 0.75% in May, even though it comes after inflation weakened to a one-year low of 2.5% in March.

Howard Archer, EY Item Club’s chief economic adviser, said: “The monetary policy committee expected the economy to take a hit in the first quarter from the severe weather and sees a bounce back in activity in the second quarter. It is also keen to gradually normalise monetary policy.”

Samuel Tombs, the chief UK economist at Pantheon Macroeconomics, said: “Sales should rebound in April as people jumped back in their cars and finally started to buy spring clothing.”

However, he added: “Households also have adopted a more cautious mindset in recent months, having thrown caution to the wind last year. Savings intentions have increased to their highest level since September 2008, according to GfK’s consumer confidence survey, suggesting that retailers won’t benefit much from the forthcoming modest recovery in real wages. In short, consumers still are not in a position to drive the economy strongly forwards.”

Department store group Debenhams reported an 85% slump in pre-tax profits on Thursday, after the “beast from the east” forced the retailer to temporarily shut almost 100 stores.