LONDON: The crucial Christmas shopping period appears weaker than expected in the United Kingdom as consumers, burdened by higher inflation, carefully watched their spending.

       Total sales grew 1.7% in December, compared with almost 7% growth a year earlier, the British Retail Consortium (BRC) and consultancy KPMG said in a report yesterday.

       Sales of non-food items declined over the three months to December, with shoppers particularly avoiding big-ticket purchases such as furniture and homeware.

       Clothing, jewellery and technology were other gift categories that struggled.

       “The festive period failed to make amends for a challenging year of sluggish retail sales growth,” said Helen Dickinson, chief executive of the BRC.

       “Weak consumer confidence continued to hold back spending.”

       The weak data may stoke concerns that the UK economy could tip into a recession as consumers worry about their financial security.

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       Even as inflation eases in the United Kingdom, shoppers are still having to spend more to get less, and many are focusing on necessities such as food, heating and housing costs.

       The festive spending season already got off to a weak start in November as consumers felt the burden of the higher cost of living.

       It’s an important period for retailers, with November and December accounting for a fifth of the year’s sales, and even more in some cases.

       Food sales were a notable bright spot, increasing 6.8% in the three months to December amid higher prices. Volumes of goods sold also increased last month compared with a year earlier.

       Shoppers spent a record ￡13.7bil on food in December as they entertained family and friends, data provider Kantar said last week.

       Beauty, health and personal care products, as well as toys and gaming, also sold well, with consumers focusing on affordable gifts and treats.

       Online sales fell almost 1% year on year, which was still a better performance than Christmas 2022, when postal strikes encouraged people to visit shops in person instead.

       Trading updates this week from J Sainsbury Plc, Tesco Plc, and Marks and Spencer Group Plc will provide more details on how some of the UK’s largest retailers fared over the Christmas season.

       “The festive feel-good factor was lacking this year as many retailers faced a disappointing December,” said Paul Martin, UK head of retail at KPMG.

       “The constant drip” of economic challenges consumers have faced over the last two years “has finally come home to roost”.

       Spending increased on entertainment and travel in December as consumers prioritised experiences and holidays, according to separate data from Barclays, which processes credit and debit card transactions.

       Spending at pubs, bars and clubs rose nearly 8%, fuelled by Christmas parties and gatherings.

       The difficult trading environment for retailers is expected to continue this year as shoppers see little respite from higher living costs.

       The situation will be worsened by shipping delays due to unrest in the Red Sea as well as increases in business rates and the national living wage starting in April.

       Weaker retail performance may revive talk of a technical recession, defined as two consecutive quarters of contraction.

       That would be a bleak backdrop for Prime Minister Rishi Sunak to attempt to win re-election, and it could also spur speculation that the Bank of England will move toward cutting interest rates. — Bloomberg