Consumer caution
February 2009
UK retail conditions deteriorated sharply at the end of 2008 with trading volumes falling over the Christmas period despite pre-holiday sales promotions from many on the high street.
Within the data there is a clear move to price conscious shopping and a trend to defer discretionary spending. Although consumer sentiment has been buffeted by negative media commentaries in the past few months and this may have influenced behaviours, the underlying momentum in activity is negative and this will continue as unemployment increases.
This is clearly not a positive trend for the sector. Charity shop sales may hold up better than some but this is simply not a buoyant picture and all sectors will be squeezed as discretionary spending is reined – in.
John Kelly, head of client investment at CCLA
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