Retail sales growth in London lowest since May

Retail sales growth in London in September was the weakest since May and could have a knock-on effect on Christmas sales, according to the London Retail Consortium.

But like-for-like sales in the capital were up 6.8% on September 2006 and up 9.6% between July and September and the same period last year. However clothing and footwear sales were well above last September.

"Although London continues to outperform the UK as a whole, sales growth was the weakest since May and is being driven by promotional activity," said Kevin Hawkins director of the London Retail Consortium.

"Spending confidence seems to be weakening as, despite a higher level of consumers on the high street compared with August, sales growth has slowed. Price is likely to continue to be the main stimulant of demand in the coming months as consumers' willingness to spend weakens," he added.

Helen Dickinson, head of retail at KPMG, said the recent credit crunch is already making an impact in the capital.

"The real acid test will come in the lead up to Christmas, which is predicted to arrive later this year for many retailers," she said.