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Retail footfall declined by 0.5% in February according to the latest BRC – Springboard footfall and vacancies monitor, though this latest decline marked an improvement on recent falls in shopper numbers.

The year-on-year footfall decline in February of 0.5% is a major decline compared to growth of 1% seen during February 2017.

However, the figure is comfortably better than than the three-month average of -2% and also an improvement on the twelve-month average of -0.7%.

Half of the regions in the UK saw growth in February, the most notable being Northern Ireland which grew by 0.3% per cent, ending eight months of consecutive decline. East Midlands grew by 2.1% per cent up from the 2.2% decrease in the previous month. T

Greater London and the South East continue to experience decline of 1.1% and 1% respectively.

Retail Parks outperformed all other shopping locations, with shopping centres the weakest performing of all three shopping destinations.

British Retail Consortium chief exec Helen Dickinson commented: “Footfall continued to fall year-on-year in February across most retail destinations, even before the significant impact of the snow over the last two weeks. This was mirrored in relatively flat consumer spending overall, that continues to struggle against the current retail headwinds.

“Looking ahead, there’s some hope that shopper activity will pick-up now that inflationary pressure has started to subside and wage growth is expected to move in the right direction. But this will offer only modest relief to retailers and consumers and the recent sad news announcing the closures of several well-known high street retailers should sharpen our focus to what is going on in retail in the UK at present.

Diane Wehrle, Springboard marketing and insights director added: “It is still tricky to get an accurate temperature reading of retail trading trends this year. The current raft of closures amongst retailers and hospitality operators are at least in part due to overly bullish budgeting over the period from 2015, before the pre-Brexit economic jitters; but clearly exacerbated by poorer than expected Christmas trading.

“The recent snow and an early Easter will impact footfall in March, and so April’s footfall will also be affected. A true like for like trading picture will therefore only be clear at the end of the second quarter meaning retailers will have to hold their breaths to know how 2018 is shaping up.”

Morning update

Credit card company Visa has found that UK consumer spending has had its weakest start to the year since 2012.

Visa found that inflation-adjusted consumer spending in February dropped 1.1% year-on-year, exacerbating a 1.2% decline recorded in January.

Visa found consumer spending has now fallen in nine of the past 10 months and the first quarter of 2018 is on track to be the worst on record.

Mark Antipof, chief commercial officer at Visa, commented: “Britons have been in belt-tightening mode since last summer. February’s cold snap certainly didn’t alleviate this situation, particularly when we shine a spotlight on high street spending, and recreation and culture in particular, which saw its biggest decline since April 2010.

“As we look ahead into March, consumer spending is at risk of posting one of the worst Q1 results on record. Retailers will no doubt be hoping that the milder weather will put a spring in shoppers’ steps.”

Annabel Fiddes, principal economist at IHS Markit, added: “The High Street remained a key source of weakness, seeing spend fall for the tenth month in a row, while growth in eCommerce spending continued to disappoint.

“Rising living costs, lacklustre wage growth and relatively subdued consumer confidence are all likely playing a part in the ongoing reduction in household spending. Unless the squeeze on incomes subsides, it looks unlikely that household spending will pick up anytime soon.”

Meanwhile, EY ITEM Club is offering offers some reasons for optimism for UK consumers after a tough 2018, predicting falling levels of inflation and a modest revival in pay growth.

However, the EY ITEM Club says that the good news will be offset by new headwinds including weaker employment growth, rising interest rates and more reluctance among consumers to ‘live beyond their means’.

According to the EY ITEM Club’s special report published today, consumer spending growth more than halved to 1.4% in 2017 from 2.9% in 2016 - the smallest increase since 2011. The report forecasts that consumer spending growth will see little change in 2018, running at 1.3%, before rebounding to 1.6% in 2019 and 1.9% in 2020.

Mark Gregory, EY’s chief economist, UK comments: “We are going to see stable but sluggish growth in consumer spending this year with little prospect of achieving the levels achieved in 2016. While the impact of higher inflation should slowly fade, the UK consumer will be hit by new issues which will impact their spending power.”

On the markets this morning, the FTSE 100 has opened the week down 0.1% at 7,216.3pts so far this morning.

Conviviality (CVR) has started the long road back after the shock share price plunge last week, climbing 11.5% so far this morning back to 120.5p having been below 100p on Friday.

Other risers include McColl’s (MCLS), up 3.2% to 246.7p, McBride (MCB), up 2.4% to 154.8p, Marks & Spencer (MKS), up 2.3% to 284p, Greene King (GNK), up 2.3% to 298.8p and Bakkavor (BAK), up 2.1% to 189.9p.

Early fallers include Just Eat (JE), down 4.3% to 754.8p after a turbulent week last week, Majestic Wine (WINE), down 2.2% to 432.3p and Applegreen (APGN), ahead of its annual results, down 1.9% to 485p.

This week in the City

It’s not the most packed financial calendar this week, but there are two major full-year results with Morrisons and Fever-Tree reporting.

Tomorrow brings full-year preliminary results from City growth story Fever-Tree, which has shrugged off wobbles in the wider market to grow another 26% in value so far in 2018. Fever-Tree has already told the market its UK growth will be above expectations and the market will be watching its forecast keenly for indications on the extent this growth may slow down and the margin impact of rising costs.

Also tomorrow brings full-year results from forecourt operator Applegreen (APGN) and logistics and distribution group John Menzies (MNZS).

Then on Wednesday it is the turn of Morrisons to issue its full-year results. The 2017/18 financial year has continued the supermarket’s strong recovery under David Potts and the grocer is expected to post a rise in annual profits as well as another quarter of healthy like-for-like sales growth.

In wider economic news, Tuesday brings the Spring Budget Statement – rather than a full budget, which was announced in the autumn. Chancellor Phillip Hammond is rumoured to have some better news on OBR forecasts in a statement likely to be dominated by the effect of Brexit on UK growth.