[an error occurred while processing this directive]
BBC News
watch One-Minute World News
Last Updated: Tuesday, 10 May, 2005, 12:46 GMT 13:46 UK
April slowdown hits retail sales
Shopping mall
A number of factors have led to a shopping slowdown
UK retail sales fell by their biggest amount in a decade during April, the British Retail Consortium has said.

Like-for-like sales slipped by 4.7% against the same month in 2004, partly due to the fact that the busy Easter trading period fell in March this year.

The drop was the biggest since BRC records began in 1995, and a bigger slump than the previous worst figure of minus 4.6% in April 1999.

BRC director general Kevin Hawkins said the figures were "worse than expected".

Election worries

The sales slide compared with growth in sales of 1.8% in March, but those figures were helped by Easter shopping activity.

Mr Hawkins told the BBC's Radio 4 Today programme: "We knew it was going to be bad because Easter fell in March this year.

"We have also had the general election campaign and people have been worried about interest rate rises and possible tax rises.

"However the 4.7% figure is worse than anyone expected, and the worse since the mid-1990s."

At the moment we have got a slowdown and we have to be careful it doesn't go into recession
Tim Sleep, Ernst & Young retail analyst

He said trade had worsened in most categories of High Street sales, but particularly for occasional purchases and non-essentials. Sales of big ticket items, particularly white electrical goods and furniture, slowed too.

But younger fashion clothing and footwear were boosted during spells of better weather.

The BBC's business editor Jeff Randall said the retail figures come after a number of well-known retailers such as Kingfisher, Matalan, and Signet indicated "business had been much worse than had been expected".

The figures come a day after the Bank of England decided to keep interest rates on hold at 4.75%, and Mr Hawkins called on the Bank to now consider a rate cut.

"A slowing housing market, pre-election economic uncertainty and the continuing threat of interest rate rises dominated consumer confidence in April," Mr Hawkins said.

'Confidence low'

Ernst & Young retail analyst Tim Sleep said many experts now thought that interest rates might remain on hold during the summer.

HAVE YOUR SAY
I'm battening down the hatches financially to make sure I can weather any event the best I can
Roland Bone, Stirling, Scotland

"At the moment we have got a slowdown and we have to be careful it doesn't go into recession," he said.

"The disposable incomes of most households are lower than they were.

"There are also higher fuel and utility bills, and we have seen general election jitters too, as well as unprecedented levels of credit card debt.

"Consumer confidence is very low."

However analysts at Capital Economics said the survey was "almost certainly over-doing the pessimism" because of "timing issues caused by the earlier fall of Easter".

It concluded that the findings should be "treated with caution", while conceding that conditions on the High Street remain "gloomy".




BBC NEWS: VIDEO AND AUDIO
Why the mood amongst shoppers is changing



SEE ALSO:
Retail sales stagnate in February
08 Mar 05 |  Business
UK retail sales edge up slightly
01 Mar 05 |  Business
Sales 'spur shop price deflation'
10 Feb 05 |  Business
Sales 'fail to boost High Street'
08 Feb 05 |  Business
Christmas sales worst since 1981
21 Jan 05 |  Business
Festive sales 'worst in 10 years'
11 Jan 05 |  Business


RELATED INTERNET LINKS:
The BBC is not responsible for the content of external internet sites


PRODUCTS AND SERVICES

News Front Page | Africa | Americas | Asia-Pacific | Europe | Middle East | South Asia
UK | Business | Entertainment | Science/Nature | Technology | Health
Have Your Say | In Pictures | Week at a Glance | Country Profiles | In Depth | Programmes
Americas Africa Europe Middle East South Asia Asia Pacific