Fatigue ends shopping boom

CONSUMERS are suffering from shopping fatigue, new figures show, indicating the retail boom has come to an abrupt halt. Visitor numbers to 50 of Britain's biggest shopping centres last week were 3.7% lower than the week before and 9.4% lower than the same week a year ago, according to shopping monitoring company FootFall.

Today's figures extend the steady decline since Christmas. FootFall marketing manager David Smyth said: 'This puts an end to the retail boom recorded over the Christmas period. If this trend continues, the retail industry could face a bleak February.'

Evidence that consumers are tightening their belts will shorten the odds on further interest rate cuts. The Bank of England's monetary policy committee voted unanimously to keep interest rates at 4% this month and left the prospect of further reductions in the balance.

The minutes of the meeting held on 9 and 10 January, revealed the nine-strong committee felt there may be a case for lower rates if consumer spending slows before the global economy recovers. But members also argued that the cost of borrowing may have to rise if consumer spending fails to slow fast enough.

'On balance, there was a reasonable prospect that consumption would slow naturally at broadly the same time that the world economy recovered,' the minutes said.

Meanwhile, balance of payments figures showed a sharp deterioration in Britain's trade position in November as exports faltered and buoyant consumer spending in the run-up to Christmas sucked in foreign goods.

The trade in goods deficit ballooned to £2.8bn from £2.4bn the previous month. More-up-to-date figures for trade with non-European countries revealed a deficit of £2.4bn in December against November's £2bn.

Economists warned that the current account deficit will widen as long as High Street activity remains resilient and the global economy weak. 'At the moment this is not a problem,' said HSBC's John Butler. 'However, further out this could put increasing strain on sterling.'

Sterling was a quarter of a cent weaker at $1.4270.