Christmas sales this year are forecast to be the best since the pre-recession levels of 2007, according to a report released by Verdict Retail. Consumer spending is expected to reach £88.4bn in the fourth quarter, a 2.2 per cent increase from last year. Online sales are set to reach £11.6bn, a 12 per cent rise from last year.
Maureen Hinton, Verdict’s research director, said in the report:
Shoppers have far more reasons to be cheerful this year.
On top of all this, during the recession there has been a baby boom which means one of the prime targets for Christmas spending, kids, is growing.
Verdict expects 23 December to be "Mad Monday" when click and collect customers collect their items at the last minute. The report cites recovery in the housing market and rising consumer confidence as accounting for the potentially strong growth. The improving outlook for retail sales comes on the same day as Ernst & Young release their Autumn forecast for the UK.
Ernst & Young increased the UK's GDP growth forecast to 1.4 per cent in 2013 and 2.4 per cent in 2014. These figures were revised up from forecasts of 1.1 per cent and 2.2 per cent made last quarter. The report asserted that the current recovery is largely driven by consumer spending and an improved housing market. However the report expected business investment and exports to help drive UK growth towards a more sustainable trajectory. The group also rejected the argument that the government Help to Buy scheme will result in a housing bubble.