Christmas sales disappoint

08-01-2008

Christmas sales disappoint
Retailers suffered a weak Christmas with weak sales figures making the festive season far from merry for shopkeepers, figures out today show.

The KPMG/British Retail Consortium's (BRC) retail sales index saw total like-for-like growth of just 0.3 per cent in December, compared to 2.5 per cent in December 2006 and 2.6 per cent in December 2005.

Clothing and footwear sales actually saw a decline in sales while homewares and furniture also did badly, despite desperate price discounting.

Helen Dickinson, head of retail at accountancy firm KPMG, said growth "could only be described as weak" in December.

"In the lead-up to Christmas there were huge daily swings as shoppers replaced even spending patterns with a smaller number of bargain-hunting 'big swoops'," she explained.

"This sets the scene for the new year ahead and like-for-like sales look set to move into negative territory as they did in 2005."

BRC director general Kevin Hawkins called on the Bank of England to cut interest rate rises by 0.5 per cent in January following news of the poor Christmas.

"This result is somewhat worse than we expected," he commented.

"Given that the full effects of the Bank's previous increases in interest rates have yet to be felt by many households, retailers and manufacturers alike need a rate cut now."

The monetary policy committee (MPC) meets to decide whether to follow-up December's quarter-point cut to 5.5 per cent on Thursday.

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