Interest rate rise hits High Street hard
The latest Retail FootFall Index figures from FootFall, show that the weakness displayed at the end of 2006 in the retail sector has continued into 2007, with shopper numbers falling 6.3 per cent since the previous week and 9.9 per cent on 2006.
Last week’s interest rate hike and speculation about further rises has only contributed to the downcast mood.
Natasha Burton, spokesperson for FootFall, comments: “This week’s official data showing RPI inflation at 4.4% running well ahead of average earnings at 4.1%, further emphasises the impact of higher utility bills and interest rates on consumers’ spending power and the subsequent weakness of retail footfall.
“However, the Town Centre sector has benefited from the ‘post-holiday’ mood this week. The first full week back at work has boosted the sector considerably, driving footfall levels up 2.7% compared to the previous week and taking the index only 2.7% behind 2006. This highlights the sector’s appeal as a convenience and ‘local use’ destination, perfect for shopping during lunch hours or for necessity missions.
“With the January sales well under way, the next few weeks would normally see a glut of consumers on the high street. It will be interesting to see what how far-reaching the effect of the interest rate rise will be,”
