Supermarkets were one of the few retail groups to boost sales in the run up to Christmas.

The UK high street suffered its worst Christmas for three years in 2007, according to figures from the British Retail Consortium (BRC).

The group said like-for-like sales rose just 0.3% in December, compared with a 2.5% increase in December 2006. The figure is three times lower than the bleakest City forecasts.

The disappointing results prompted the BRC to call for the Bank of England to cut interest rates today, however rates have remained unchanged at 5.5%.

Kevin Hawkins, BRC Director General, said: “This decision makes the need for a cut next month all the more pressing. The worst Christmas sales growth for three years shows consumers and retailers are still feeling the effects of five previous rate rises as other bills continue to shoot up.

“While appreciating the decision was finely balanced, given the inflationary pressures facing the economy, 2008 is going to be tough for all customer-facing businesses.”

The BRC’s figures for December showed that the food and drink sector generated the strongest performance, whilst toiletries and cosmetic sales also grew. Clothing and footwear sales fell for the third consecutive month. Home entertainment products proved popular with consumers, generated by the popularity of computer games, consoles and books.

In addition, the BRC identified changes in shopping habits, stating that Christmas shoppers are replacing ‘even’ spending patterns with a smaller number of bargain hunting ‘big swoops’.

To read the full report, visit the BRC website: www.brc.org.uk

By Natasha Piscitelli