Price cuts help High St but pick-up will not last
Price-slashing earned High Street retailers a temporary reprieve in early December but the picture for January is bleak, the CBI warned today.
The business group's latest survey showed hard-pressed shoppers willing to open their wallets a fraction for Christmas but reluctant to spend their cash on anything else, particularly expensive big-ticket items.
The CBI's survey showed a 9% balance of firms reporting higher sales than a year ago in the first two weeks of crucial festive trading, exceeding downbeat City expectations with the first sales growth for seven months. But promotions have been behind the rise and sales are expected to slip back into the red in a bleak beginning to 2012.
Asda chief financial officer Judith McKenna, who is chairman of the CBI's distributive trades panel, said: "Early discounting helped retailers [but] they don't expect sales to continue to grow into January.
"Consumers are continuing to hold off on purchasing big ticket items preferring to use their hard-earned cash to stock up for Christmas dinner and important gifts for the family."
Capital Economics' Samuel Tombs said: "Even if festive trading turns out to be brisk, the chances are high that the post-Christmas spending hangover will be even deeper than usual."
