Black Wednesday casts a cloud over retailers

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The Independent Online
SOME parts of the High Street have felt a renewed chill in the three weeks since Black Wednesday, the day interest rates threatened to jump 5 percentage points and sterling left the exchange rate mechanism.

Earlier this week Barry Reed, chairman of the fashion retailer Austin Reed, said that year-on- year sales had declined since 16 September after being level-pegging in August and early September.

Geoffrey Maitland Smith, chairman of Sears, said trading in August and the first part of September was good as bad weather brought forward autumn sales. Since mid-September trading had 'gone flat again'.

Mr Maitland Smith said: 'Black Wednesday has not helped because it has affected the confidence of the general public'. He added that the problem was not lack of money, because those in work were enjoying pay rises and mortgage repayment reductions. The problem was fear of unemployment and uncertainty.

A spokesman for John Lewis, the department stores partnership, said: 'The improved sales of August and early September have not been sustained and have tapered off.' The upturn came to a halt in the week ending 12 September.

However Stanley Kalms, chairman of Dixons Group, said trading had been patchy but was back to the trend apparent before the Black Wednesday blip. Sales were 'stable, modestly encouraging at times, but there was no sign yet of consumer confidence coming back'.

David Jones, chief executive of Next, said nothing had happened to make him rethink his first-half trading statement that August sales showed an encouraging increase year-on-year.

Kevin Hawkins, director of corporate affairs at WH Smith, said trading was still tough, as it had been for months, but there had been no significant further deterioration since Black Wednesday.