FRENZIED discounting across high street stores failed to stave off a drop in retail sales last month as wary consumers continued to rein in their spending in the crucial Christmas trading period.
And in more bearish news for the economy, a survey from the CBI showed that orders at manufacturers have slumped to their lowest balance since October 2010.
Demand for exports from British factories also sunk to its weakest level since January 2010, the CBI said.
“Manufacturers expect to reduce production over the next three months,” the report warned.
In the UK’s shops, retail sales volumes fell 0.4 per cent in November compared with the previous month, figures from the Office for National Statistics (ONS) revealed yesterday. Excluding fuel, sales fell 0.7 per cent on the month.
Howard Archer, chief economist at IHS Global Insight, said the figures showed “not a very merry start to the Christmas season for retailers”.
“It is the Christmas period that is particularly vital for most retailers and the 0.4 per cent drop in sales volumes in November indicates that they are having their work cut out to get pressurised and worried consumers to spend,” Archer said.
Last week shoemaker Barratts Priceless became the latest victim of the retail gloom, falling into administration.
Overall sales growth for the three month period, however, was more positive, with sales up by 0.7 per cent following a one per cent rise in October. The volume of sales was up 0.7 per cent on the year.
Meanwhile, the average weekly spend on online retailing has surged to £787.9m, up from £546.4m the same time last year and is now estimated to account for 12.2 per cent of all retail sales excluding automotive fuel.