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UK retail spending growth was “small” and below the inflation rate in the last three months of 2024, suggesting consumers remained cautious in what is typically the busiest period of the year for shops.
In the three months to December, sales rose just 0.4% compared to the same period in 2023, when economy The retail sector was in a technical recession, according to figures published by the British Retail Consortium on Tuesday.
The trade body data was not adjusted for headline inflation, which reached 2.6 percent in November, suggesting that consumers reduced the amount of goods they bought during the period.
“Sales growth during the October-December golden quarter was minimal, reflecting the continued careful management of many household budgets during a time when Many costs are at a high level compared to previous years.
Sales of non-food items were particularly hard hit, shrinking compared to the previous year, according to the data.
Helen Dickinson, chief executive of BRC, said: “After a challenging year marked by weak consumer confidence and difficult economic conditions, the crucial ‘Golden Quarter’ has failed to deliver 2024 what retailers had hoped for.”
Tuesday's figures are the first consumer spending figures for the shopping period covering the global sales event Black Friday and Christmas, adding to signs that the economy is struggling in the final quarter of 2024.
The ministers have come under Heavy fire out of work since the Budget in October, with employers bemoaning higher employers' National Insurance contributions, as well as increases in the National Living Wage.
The weak confidence coincided with weak readings on gross domestic product, with the Bank of England estimating that the economy failed to grow in the last quarter of 2024 despite a strong start.
Growth in UK manufacturing and services activity fell last month to the lowest level since October 2023, according to data published by S&P Global on Monday.
Sales at brick-and-mortar stores were particularly weak in the last three months of the year, growing by 0.1 percent in value and falling in volume, according to figures published by accounting firm BDO on Tuesday.
Meanwhile, separate data published by Barclays showed no growth in consumer card spending figures in December, with contractions in supermarkets, home improvement stores and fuel spending.
BRC expects sales to grow by 1.2 percent in 2025, less than the expected store price inflation of 1.8 percent.
Dickinson said the estimates meant volumes were likely to fall this year, adding to pressures on businesses including a rise in the National Living Wage and higher employer National Insurance contributions from April.
“With little hope of covering these costs through increased sales, retailers are likely to raise prices and reduce investment in stores and jobs, damaging our high streets and the communities that depend on them,” she said.
