Like-for-like sales in December in London were at their highest for seven years, up 12% against a year ago when sales dropped 0.7% in the wake of the banking collapse.
Sales in clothing and footwear were driven by the wintry weather as well as gift buying, according to the BRC-KPMG London Retail Sales Index. Beauty products and jewellery were also strong.
Retail footfall in December fell back below its year-earlier level to show its weakest performance since September. According to Synovate, footfall in central London was 4.3% lower than December 2008. The wintry weather and a reduction in discounting compared to a year ago meant fewer people made shopping trips but those that did, spent more.
The weakness of the pound attracted tourists to the capital during the month, in particular from western Europe, China and the Middle East.
The capital outperformed the rest of the UK as a whole, where like-for-like sales rose 4.2% against a 3.3% fall in December 2008.
Stephen Robertson, BRC director general, said it was a “dazzling” performance “all the more impressive following a strong November”. He added: “The result is boosted because the comparison is with terrible figures a year ago when financial turmoil hit London consumers especially hard but this is outstanding growth by any interpretation.
“Generally customers were a lot more positive than the year before, so more willing and able to spend. A big Saturday Boxing Day start to many post-Christmas sales produced a strong ‘extra’ day’s trading for lots of retailers and the weak pound tempted overseas shoppers to London.
“Wintry weather kept people away from shops on some days but when they did go they spent more. But, given the prospects for jobs, wages and taxes in 2010, don’t assume customers will go on spending like this.”
Helen Dickinson, head of retail, KPMG, said: “Although the rest of the country saw a relatively slow build up to early Christmas trade in November, London bucked this trend and this strong performance continued in December. These are great figures and Christmas really provided an opportunity for department stores to outperform, leading to a pronounced polarisation between retailers who got the proposition right and those that did not. December’s results also showed the growing importance of post-Christmas trading and the ongoing weakness of the pound has certainly continued to attract overseas visitors.”