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LONDON, Jan 6 (Reuters) - A spending spree by Britishshoppers in the week before Christmas failed to prevent sales inDecember from falling short of the previous year's level,industry data showed on Friday.
Robust growth in consumer spending has been one of the mainfactors sustaining Britain's economy since last June's vote toleave the European Union. But many retailers fear a squeeze onspending as inflation begins to erode real earnings growth in2017.
Like-for-like retail sales in December fell 0.1 percent yearon year, according to BDO, the accountancy and business advisoryfirm. However, online sales in the month rose 19 percent year onyear, further evidence of a continuing shift in shopping habits.
"With such a weak base for December 2015 (when sales fell5.3 percent) any further decline can only be seen as a poorresult for retailers," said Sophie Michael, head of retail andwholesale at BDO.
"Coming at a critical juncture, this fourth negativeDecember in succession highlights the magnitude of the challengethat lies ahead for 2017, when consumers will more keenly feelthe bite of inflation and the weaker pound," she added.
Sales of fashion goods declined 1.07 percent in December,but the overall figure was pushed toward parity by like-for-likeincreases in the lifestyle and homewares sectors, up 2.4 percentand 2.6 percent respectively. Lifestyle includes gift andtechnology items.
BDO said that in the week leading up to Christmas Day salesincreased 11.7 percent year on year - the largest weekly growthfigure for the whole of 2016. However, the outcome partlyreflected Christmas Day falling on a Sunday.
On Wednesday clothing retailer Next, the first majorBritish retailer to give an update on Christmas trading, cut itsprofit forecast for the current financial year and warned of afurther decline in 2017-18.
The British Retail Consortium is scheduled to publishDecember sales data on Jan. 10. Official data for the month ispublished on Jan. 20.
Next week will also see a raft of Christmas trading updates,including from supermarkets Morrisons, Sainsbury's and Tesco and from Marks & Spencer, Debenhams and ASOS. (Reporting by James Davey; Editing by Keith Weir)
