Retailers set to slash prices as high street gets festive jitters
City analysts have raised fears that high street trading has been weaker than expected in December, raising the spectre of discounts in the final week before Christmas amid speculation that consumers are not feeling the benefit of economic recovery.
New figures from the British Retail Consortium show footfall on high streets last month was 2.9 per cent lower than a year ago and was "negative across the board" in every region of the UK that was surveyed. Diane Wehrle, Retail Insights Director at research firm Springboard, said it was "disappointing and suggests that Christmas trading could be challenging if December 2012 is anything to go by".
Howard Archer, chief UK & European economist at research firm IHS Global insight, warned: "A growing number of retailers may feel under very real pressure to engage in significant discounting and promotions given that there is now less than 10 shopping days to Christmas."
Several leading retailers including Tesco have been running price promotions in recent days, while John Lewis has reported patchy sales growth, up 3.7 per cent week on week last week but down 1.7 per cent one week earlier.
"There is considerable uncertainty over just how good a Christmas this will be for retailers," said Mr Archer, who suggested "a large number of consumers are deliberately delaying much of their Christmas shopping in the hope that retailers will make increasingly attractive offers as Christmas gets ever nearer". Next weekend, the last before Christmas, is likely to be "particularly crucial".
Mr Archer added that "consumers took a breather in November and October after spending at a rapid rate through the third quarter".
The City is awaiting a raft of new economic data this week, including jobless figures on Wednesday, and inflation data.
Subscribe to Independent Premium to bookmark this article
Want to bookmark your favourite articles and stories to read or reference later? Start your Independent Premium subscription today.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies