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Growth in UK retail ad spending was “slight” and below the rate of inflation in the last three months of 2024, suggesting consumers remain cautious in what is typically a year-over-year shopping spree.
In the three months to December, sales rose by just 0.4 percent from the same period in 2023, when the economy was in recession, according to figures published by the British Retail Consortium on Tuesday.
The board of trade data is unadjusted for headline inflation, which stood at 2.6 percent in November, indicating that consumers cut back on the amount of goods they bought this time.
Linda Ellett, UK head of consumer, retail and leisure at consultancy KPMG which helped compile the data, said: “Sales growth during the golden quarter from October to December was small, reflecting the careful management of many housing budgets during that time. remain at a higher level compared to previous years.
Non-food sales were weak, compared to a year earlier, according to the data.
BRC chief executive Helen Dickinson said: “After a challenging year marked by weak confidence and difficult economic conditions, the all-important 'golden quarter' failed to deliver the 2024 retailers had hoped to deliver.”
On Tuesday are the first figures for consumer spending in a shopping season that includes the global shopping event Black Friday and Christmas, adding to signs that the economy is struggling in the last quarter of 2024.
The ministers went down heavy fire from business since the Budget in October, as bosses complain about higher employer contributions to national insurance, and increases in the national living wage.
Lowered confidence coincides with weak GDP readings, as the Bank of England predicts that the economy will fail to grow in the last quarter of 2024 despite a strong start.
Growth in UK manufacturing and services employment fell last month to the lowest since October 2023, according to data published by S & P Global on Monday.
Sales in brick and mortar stores were very negative in the last three months of the year, registering a growth of 0.1 percent in terms of value and depreciation, according to figures published on Tuesday by the accounting firm BDO.
Meanwhile, separate data published by Barclays showed no growth in consumer card spending in December, with reductions in supermarkets, home improvement stores and spending on fuel.
The BRC predicts sales growth of 1.2 percent in 2025, below the retail price forecast of 1.8 percent.
Dickinson said forecasts meant numbers could fall this year, adding to pressure on businesses including a rise in the national living wage and higher employer insurance contributions from April.
“With little hope of meeting these costs through higher sales, retailers can raise prices and reduce investment in stores and operations, damaging our high streets and the communities that depend on them,” he said.