(Adds comment, reaction)
LONDON, March 26 (Reuters) - British retail sales plunged in February, posting the lowest annual growth rate in more than four years, as heavy snowy and economic gloom kept consumers away from the shops, official data showed on Thursday.
The Office for National Statistics said sales fell 1.9 percent in February, nearly five times the 0.4 percent fall expected by analysts.
That took the annual rate of growth to just 0.4 percent -- its weakest since September 1995 and well below forecasts for 2.5 percent.
The pound fell half a cent against the dollar immediately after the figures were released but recovered quickly.
"It is not a huge shock given the Arctic conditions in February and the previous few months data has been very firm," said Philip Shaw, economist at Investec.
"It is very difficult to read what is going on in the High Street given the volatility of the numbers."
Official retail sales figures had been surprisingly strong in recent months, in stark contrast to gloomy reports from retailers themselves.
A Confederation of British Industry survey on Wednesday showed retail sales fell more sharply than expected in March and stores were just as gloomy about their prospects next month. [ID:nLP942431]
The ONS said sales fell across the board last month and that a major factor was poor weather conditions at the start of February, when Britain suffered its most widespread snowfall since 1991, bringing transport networks to a standstill.
The economic downturn also played a part in making consumers reluctant to spend.
Britain fell into recession for the first time in almost 20 years at the end of 2008 and the downturn is expected to continue for much of this year. Unemployment has been rising sharply and broke through 2 million at the start of this year for the first time in more than a decade.
"We expect further sharp declines given that unemployment is surging, nominal wages are now falling, wealth is plunging due to weak equity markets and falling house prices, while confidence is at all-time lows," said James Knightley, economist at ING.
The fall in spending coincided with a small pick-up in prices as seasonal discounts came to an end. Prices rose 0.3 percent on the year, after a 0.9 percent fall in January. (Editing by Mike Peacock) (UK Economics Desk, uk.economics@reuters.com, Tel: 44 207 542 5109))