By Marcus Leach
With Christmas just around the corner UK retailers suffered a set back with the news that retail sales failed to grow in November.
Data from the Office for National Statistics (ONS) shows that sales were flat in November compared with October, adding to fears that consumers are feeling the squeeze and reining spending in ahead of the festive season.
They had been expected to bounce back after October's shock 0.8% fall.
The one bright spot was in household goods stores, where sales rose by 3.8% on the month, including consumer electrical items.
“November proved to be an uninspiring month, however, the final festive push is underway, with many retailers extending opening hours to ensure they get every last penny through the door," Richard Lowe, Head of Retail & Wholesale at Barclays said.
David Kern, Chief Economist at the British Chambers of Commerce (BCC) said the flat retail sales point to weaker growth in Q4 of 2012.
“Though marginally weaker than analysts predicted, the November retail sales compare favourably with the fall recorded in October," he said.
"They support our view that the economy would slow markedly in the fourth quarter, but it is premature to assume that there would be an outright decline in activity.
"Despite this, one welcome development is that annual inflation in the retail sector slowed in November to 0.5%, after accelerating in the previous month to 0.9%. Reduced store price inflation, if sustained, would be beneficial at a time when the UK is facing difficult economic challenges. Falling inflation will benefit the UK economy, as it will reduce the squeeze on businesses and consumers, and underpin domestic demand.”
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