UK consumers held back from early Christmas spending this year

Oxford Street, London

There were few signs of British consumers doing their Christmas shopping early this year, with retail sales remaining flat last month.

Official figures released today show that UK retail sales for November 2012 were unchanged from October as consumers held back on pre-Christmas spending.

According to the Office for National Statistics (ONS) there was no change in the quantity of goods bought and a fall of 0.1% in the amount spent by consumers, following decreases in both the quantity bought and the amount spent between September and October.

With Christmas Day falling on a Tuesday this year the coming weekend will be crucial for retailers, according to British Retail Consortium (BRC) director general Helen Dickinson.

“I’m expecting a last-minute rush but overall in sales terms it will be neither a bumper Christmas nor a disaster,” she added.

Today’s announcement from the ONS confirms earlier findings by the BRC which suggested that Christmas shopping was slow to take off in November. With a rise in IVA awareness and a tighter spend than in previous years, customers are proving to be more cautious in credit applications and borrowing than in previous years. Pressures on budgets and fears about the future left many shoppers reluctant to commit to spending early, Dickinson commented.

David Kern, chief economist at the British Chambers of Commerce, said that the November figures provide a further indication that the economy may slow markedly in the fourth quarter, although it is too early to assume that there will be an outright decline in activity.

Consumer spending represents around two-thirds of GDP in the UK.

Compared with November 2011, retail sales volumes in the UK rose by 0.9% last month and the amount spent increased by 1.5%.

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