Christmas retail sales in the UK will grow by 3% in December, market research organisation Mintel has predicted. The optimistic outlook is based on an improved pattern of trade in the country during 2012, spurred on by improved consumer confidence thanks in part to the ‘feel good factor’ of the Olympics. In addition, unemployment is on its way down although this could be the result of a rise in short term jobs associated with the Olympics.
"Retail sales growth has averaged around 3% so far this year and as the pressures on consumers are, if anything, easing there is no reason to suppose that that rate cannot be maintained,” said Richard Perks, Mintel’s director of retail research. “So 3% should be the median forecast."
Although a last minute surge last Christmas poses "quite a big hurdle to cross”, Perks said, “confidence is still improving, the squeeze on incomes falling and retail sales growth has recently been above the 3% average growth, even in August which should have been hit by depressed demand over the Olympics. Mintel therefore thinks that this forecast is much more likely to be too conservative than too optimistic."
Looking ahead to 2013, Mintel predicts further though modest recovery. However, Perks added: “It seems to us that leisure spending has been cut much harder than retail spending and Mintel’s tracker research strongly indicates that consumers most want to spend more on leisure. So any economic upturn will benefit retail proportionately less."
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