The survey, with 1,000 retail executives in Germany, France and Italy as respondents approximately 75% of total Eurozone retail sales, revealed that the seasonally adjusted Bloomberg Eurozone Retail PMI remained above the no-change mark of 50.0 in December, signaling higher month-on-month retail sales throughout the region.

Having indicated only marginal growth of sales in October and November, the December PMI rose to 52.2, signaling the sharpest expansion in the survey's two-year history.

And like in the U.S., although retailers reported a further increase in consumer demand, but many retailers also continued reliance on promotional activity to secure new sales. As a result, margins continued to fall sharply during the month and retailers cut jobs in order to remain competitive.

The three principal Eurozone economies all registered growth of monthly retail sales in December. Italian retailers continued to outperform their French and German counterparts, posting solid growth of sales for the fourth straight month (53.7).

German retail sales rebounded following a three-month period of contraction (51.7), while French retail sales expanded for the seventh time in the past eight months (51.5).

Even with the registered growth and aggressive promotions such as price discounts, retail sales continued to fall short of original targets in December (48.7)

Nevertheless, the recent recovery in consumer demand was underlined as sales plans were only narrowly missed during the month. Meanwhile, retailers expected their sales in January to fall short of targets (47.3).

Again, like their U.S. counterparts, there is profit worry, as Eurozone retailers' profit margins fell sharply in December (42.4).

Although sales rose from last month and targets were only missed to a marginal degree, retailers continued to resort to cutting their prices to attract customers, while average purchase prices continued to rise (53.6). However, as purchase price inflation eased to a four-month low in December, so too did the rate of contraction in profits.

This report was released by Bloomberg Eurozone Retail Purchasing Managers' Index one month ahead of government issued figures, providing businesses, governments, central banks, economists and analysts the most accurate and up to date insights and data into the Eurozone retail sector.

The Bloomberg Retail PMI report is first published exclusively for Bloomberg users on the BLOOMBERG terminal at 09:00 GMT, followed by a general press release and analysis on Bloomberg Television

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