Rising meals prices meant shoppers had little left over to spend on a festive splurge, trade figures recommend.
Like-for-like retail gross sales, which exclude new retailer gross sales, rose zero.6% final month, down on December 2016’s 1% rise.
Meals gross sales accounted for many of the rise, with spending on non-food gadgets similar to clothes down sharply.
The British Retail Consortium, which produces the information with consultancy KPMG, stated customers’ spending energy “had been absorbed by important gadgets”.
It stated this had compelled retailers which didn’t promote meals to low cost closely within the lead-up to Christmas to try to encourage customers to spend extra.
While this had helped enhance general gross sales, the BRC stated it hit many retailers’ earnings for the interval.
Over the three months to December final 12 months, gross sales of non-food gadgets fell three.7% – marking their steepest drop in 5 years, the BRC’s figures confirmed.
In the meantime, meals gross sales for a similar interval rose four.2%, their greatest rise in six months.
“The divergence between progress in gross sales of meals and non-food has by no means been so stark,” stated BRC chief govt Helen Dickinson.
Inflation is currently at a near six-year high of three.1%, simply outpacing the expansion in common earnings.
The newest official information exhibits that meals inflation specifically has picked up, with costs for fish, oil and fat similar to butter and chocolate all greater.
Because of this many patrons are spending extra on fundamental necessities.
Main non-food retailers have already indicated that they’re feeling the pressure.
On Monday, baby products chain Mothercare warned that annual profits could be considerably decrease as a consequence of weak Christmas gross sales.
Final week, division retailer chain Debenhams issued a profit warning after reporting disappointing Christmas buying and selling.
It subsequently emerged that rival chain House of Fraser was seeking to reduce rents on a few of its shops, suggesting that it too was struggling.
Nevertheless, sales at Next unexpectedly rose over the Christmas interval, prompting the style retailer to lift its revenue forecast.
Grocery store group Morrisons is because of report its festive buying and selling figures later with Sainsbury, Marks & Spencer, Tesco, John Lewis and Waitrose set to report later within the week.