Conflicting retail reports

London-based Verdict Research reported a very optimistic forecast for the coming holiday season. The company predicted that UK retailers would achieve record sales this Christmas as lower prices would encourage consumers to buy more gifts. Mobile phones, music and DVDs are reported to be especially popular.

Chairman of Verdict, Richard Hymen, stated that sales in the final quarter of this year will probably rise by 3.9% to GBP 75.8 billion as opposed to a rise of 2.5 % in the same period last year. He predicted spending in December alone would reach GBP 30 million.

Despite interest rates being at their highest in three years, a rising stock market, declining unemployment and a rise in average earnings have nevertheless boosted retail sales in the UK, says Verdict. According to industry surveys, a rapid drop in shop prices in October caused sales to rebound drastically.

However, a separate survey of UK consumers reported that spending would be at its lowest point in five years. In another survey conducted for the UK debit card provider, Switch/Maestro, UK consumers are expected to cut Christmas spending by 6.5% to an average of GBP 813 per person.

8 November 2004