Robust sales growth in January does not herald an upturn on the high street, retailers have been warned.
The BRC-KPMG Sales Monitor has revealed that like-for-like growth for the month was 4.1 per cent, while total sales climbed 6.8 per cent. However, sales tailed off towards the end of the month.
But BRC director-general Bill Moyes cautioned: 'These figures cannot be taken as evidence that the recent downward trend will not continue.'
He said that January's sales level had brought 'light relief', but reflected shoppers' postponement of purchases until after Christmas.
Moyes called on the Government to address cost burdens resulting from tax rises and over-regulation. 'Retail is being strangled between rising overheads and tighter price pressures on the high street,' he warned.
Clothing, footwear and home accessories all showed 'significant' volume increases in comparison to previous years. In-store restaurants located in London shops also notched up an 'extremely good performance'.
Electricals began strongly, but there was a 'deteriorating trend through the month', food was 'good overall' and DIY had a 'poor month'.
KPMG head of retail Amanda Aldridge said that the Bank of England's recent base rate cut to 3.75 per cent would be welcomed by retailers that are 'working hard to keep people shopping through the next few months'.
SG Securities analyst John Baillie warned retailers to be prudent. He said: 'There has been a very strong post-Christmas clearance period that isn't indicative of the current trend. Retailers need to be a bit more cautious on the outlook for 2003.'
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