Tills ringing as shoppers make a comeback

RETAILERS had a better month in March, as Easter and warm weather brought shoppers back to stores. Like-for-like sales in the capital were 0.01% higher than a year earlier compared with a 0.4% drop the previous month, according to the London Retail Consortium (LRC).

Sales in March 2004 were unusually strong because of a rebound following the Sars epidemic and the closure of the Central line. The three-month trend rate of growth rose to a 0.1% decline from a 0.9% decrease in February.

LRC director Kevin Hawkins said: 'Many retailers did enjoy the usual Easter week boost, which lifted growth out of February's negative territory, and this was helped by good weather, some discounting and the increase in visitor numbers and tourist spending.

'However, big-ticket items continued to suffer in March, as consumers remain cautious about overspending and anxious about the threat of interest rate increases.'

That view was backed by a London Chamber of Commerce report showing confidence among the capital's firms has picked up but remains below levels seen during the Iraq war.

A balance of 10% of companies in the capital believe the economy will improve over the next year against a 9% balance who thought it would deteriorate three months ago.

Expectations of rising interest rates are building, a net 44% of firms predicting the Bank of England will lift borrowing costs again compared with 36% in January.