Luxury retail chiefs said they are seeing signs that customer confidence is returning to the sector.

“I expect consumers to return to shops by Christmas,” said Tods chairman Diego Della Valle, speaking at The Financial Times’ Business of Luxury summit in Monaco. “I can already feel the change in their thinking,” he said.

LVMH chairman Bernard Arnault added: “The multiplication of products at low prices will have the effect of actually strengthening the demand for products of higher quality and higher prices. We don’t buy our dreams at the supermarket.”

Both said that the sector would look different in 2010, forecasting consolidation. However, Arnault added that “it would be wrong to say nothing will be like it used to be”.

Jimmy Choo chief executive Josh Schulman said he did not believe that price was a barrier to entry. “If an item creates desire,” he said, “it still sells”.

Burberry chief executive Angela Ahrendts said that luxury retailers need to return to “core values”.

However, Redburn Partners chief luxury goods analyst Lisa Rachal said that the positive mood was because “things were not getting any worse” although they were not getting any better.