Olympics blamed for sales decline
Retailers claim consumers preferred to stay in and watch television rather than shop over the summer
Sunday 16 September 2012
Gloomy figures outlining the Olympic sales slump crushing the high street will emerge this week as retailers count the cost of shoppers engrossed by Team GB's record medal haul.
Official numbers for August are likely to reveal an outright fall in retail sales volumes after slowing to a crawl in July, economists warn. The figures follow disappointing snapshots from the Confederation of British Industry and the British Retail Consortium for the month, and downbeat updates from the likes of fashion chain Next.
The BRC reported its worst month for sales this year due to a slump in non-food purchases, partly a result of many shoppers staying away from London high streets due to concerns over potential transport chaos. Usually resilient online sales also managed growth of just 4.8 per cent, the worst since the BRC began collecting data four years ago.
The CBI also fuelled worries over the health of the high street as retailers reported flat sales and braced themselves for a difficult autumn. Next, the UK's second-biggest retailer, added that sales had been "disappointing" in August and early September. John Lewis partnership was more upbeat when it reported half-year figures last week.
Investec's chief economist, Philip Shaw, who is pencilling in a 0.7 per cent slide in sales, said: "Next's comments on the outlook were worrying in that it said August and September were pretty quiet.
"You can blame the Olympic effect but once you get past that you have to blame something else. What this number won't tell us is whether it is down to the Games or whether there is potentially something more fundamental in play."
The difficult conditions for retailers are likely to have prompted further discounts during the month, feeding into another fall in the Bank of England's Consumer Prices Index benchmark. Analysts expect the CPI to edge down from 2.6 per cent to 2.5 per cent on the month – despite petrol prices heading back towards record levels – as the contrast with rising gas and electricity bills a year earlier flatters the figures.
An ING economist, James Knightley, who forecasts a steeper fall in the CPI to 2.4 per cent, said: "The return of higher petrol prices is not good news for retailers when consumers are already under such pressure."
The latest jobs figures underlined the extent of the wage pain still hitting British households, with average salaries growing by just 1.5 per cent in the year to July – effectively a real-terms pay cut as they trail more than one percentage point behind the cost of living.
The lingering squeeze on consumer wallets and faltering recovery in household spending is almost certain to force the Government's fiscal watchdog, the Office for Budget Responsibility, into a downgrade of its current 0.8 per cent growth forecast this year.
Sales of the tablet are set to fall again, say analysts
Met Police confirm there was a 'minor disturbance' and that no-one was arrested
George Lucas criticises the major Hollywood film studios
Does Chris Grayling realise what a vague concept he is dealing with?
Trend which requires crisps, a fork and a strong stomach is sweeping Mexico's streets
Parties threaten resort's image as a family destination
I Am Bread could actually be a challenging and nuanced title
- 1 Indian footballer Peter Biaksangzuala dies after injuring spine doing somersault celebration
- 2 Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
- 3 Banksy arrest hoax: Internet duped by fake report claiming that the street artist's identity has been revealed
- 4 Drink alcohol and eat meat to improve male fertility - but cut down on coffee, studies suggest
- 5 Brian Harvey turns up at Downing Street and 'demands to speak to Prime Minister'
Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
Banksy arrest hoax: Internet duped by fake report claiming that the street artist's identity has been revealed
'Russian submarine spotted' by Swedish military off coast of Stockholm
Brian Harvey turns up at Downing Street and 'demands to speak to Prime Minister'
Kentucky gang rape: 15-year-old boy left in critical condition after sexual attack by group at party
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Residents should throw a street party and mix with immigrant neighbours, councils told
Russell Brand threatened with arrest after filming outside Fox News headquarters
London bus driver allegedly kicks gay couple off for kissing
Amal Alamuddin calls for the return of the Elgin Marbles from Britain: 'Injustice has persisted for too long'
Lord Freud: Tory welfare minister apologises after saying disabled people are 'not worth’ the minimum wage
iJobs Money & Business
£18 - 23k + Benefits: Guru Careers: We are seeking a Customer Service Executiv...
£60 - 65k + Benefits: Guru Careers: We are seeking a ASP.NET Web Developer / ....
£60,000 - £80,000: Saxton Leigh: Our client is an leading Asset Manager based...
£27000 - £32000 Per Annum: Clearwater People Solutions Ltd: Our large charity ...