London Retail Sales Rise, Confidence Still Fragile

According to the latest edition of the BRC-KPMG London Retail Sales Monitor, which covers the period of August 30th to October 3rd, released today:

• Retail sales in central London in September were 7.5% higher, on a like-for-like basis, than a year ago, when sales had fallen 0.2%. This is compared for a 2.8% like-for-like increase for the UK as a whole.
• Retail footfall in September was only just down on a year ago. Drier, milder weather than last September’s cold and rain encouraged people to get out to the shops.
• Middle Eastern visitors returned after Ramadan, which ended earlier this year. Sterling’s weakness against the euro continued to attract western Europeans.
• Food sales held up, though growth was dampened by lower food inflation. Clothing and footwear picked up and homewares and furniture also showed some uplift, helped by an improvement in consumer confidence and the housing market.

Commenting on the figures Stephen Robertson, Director General of the British Retail Consortium, said:

“This is dramatically different from the previous month’s figure. It’s the strongest London sales growth recorded since August 2008. But it must be treated with caution. This August’s figure was compared with a strong performance a year ago. Whereas, September’s figure is compared with a very weak performance last year – when sales began to slump as the global financial crisis developed.

“London outperformed the rest of the UK, boosted by overseas visitors taking advantage of the weak pound.

“These results offer retailers a glimpse of optimism in the all important run-up to Christmas. But consumer confidence is volatile and could easily slip back”.

Data: British Retail Consortium [PDF].

Note: The London Retail Sales Monitor (LRSM) measures changes in the actual value (including VAT) of retail sales from a sample of retailers. The Monitor measures the value of spending and doesn’t adjust for price changes. In the case of price inflation, sales volumes will increase by less than sales values. During periods of price deflation, sales volumes will increase by more than sales values.

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