MNI DATA: No Christmas Cheer As UK Sales Slip To 10Yr Low: BRC

--UK Dec Like For Like Retail Sales -0.7% Y/Y Vs Nov -0.5%

By Jai Lakhani

     LONDON (MNI) - The pace of UK consumer spending fell to the weakest seen

over a Christmas in ten years, a survey published Thursday showed.

     The British Retail Consortium Retail Sales Monitor reported December

like-for-like sales down 0.7% on the year, the lowest since April excluding

Easter distortions, below the 0.5% y/y fall seen in November and the +0.6%

showing seen in December 2017.

     Total sales were flat in December, down 0.5pp from November's reading and

markedly lower than December's 2017 total sales reading of 1.4%. 

     --NO HAPPY END TO 2018

     The data suggested that households had no appetite to spend in December,

even after a weak November. Whilst the official data didn't support a weak

November Black Friday period, the seasonal adjustment was questionable and

December's reading points to a limited boost to the official retail sales. 

     "Squeezed consumers chose not to splash out this Christmas with retail

sales growth stalling for the first time in 28 months," Helen Dickinson OBE,

Chief Executive, British Retail Consortium said. 

     UK households, since the EU referendum, have had their savings eaten into

and may be prioritising the restoration of these precautionary buffers, putting

discretionary spending on the back-burner for now. Challenging conditions also

add fuel to a troublesome fire which retailers could struggle to put out.     

     "The worst December sales performance in ten years means a challenging

start to 2019 for retailers, with Business Rates set to rise once again this

year, and the threat of a No-Deal Brexit looming ever larger," she added. 

     --FOOD, TECH WINNERS

     Electronic items stayed at the top of consumers want list in December after

usurping food in November. The data appeared to suggest that despite other

sectors struggling, the grocery stores still benefitted in December. 

     "The desire to indulge over Christmas prevailed once more and seven in ten

shoppers said they spend extra on higher quality food last month," said Jon

Woolven, Strategy and Innovation Director at IGD. 

     Paul Martin, UK Head of Retail at KPMG, highlighted concerns over the

health of retailers who experienced higher sales during the festive period and

adds the first few months of 2019 are unlikely to fare much better. 

     "The first months of 2019 will unlikely hold much improvement. As many

retailers report their festive trading performance, the list of winners and

losers will become clear, but winning means more than just improving sales.

Retailers have to protect their margins in order to deliver a profitable festive

season," he said. 

--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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