Two research reports released by the British Retail Consortium reveal a tale of two cities – or at least one city, London, versus the rest of the UK. Data published for March unveils a disparity in sales between the capital, where retail sales were up two per cent on last year, and the UK as a whole, which experienced a 1.6 per cent fall. The tale, however, is complicated, with Easter falling early and the weather being so unseasonal throughout March, so as to skew comparison with the previous year’s statistics.

London is benefiting from the surge of shoppers from the eurozone attracted by the strength of the euro, which may be accounting for higher spending by these shoppers and balancing caution by domestic residents. Retail footfall may be evidence of this as it was down slightly for the month, although marginally above the March period last year.

Nationally, the story is more troubling and indicative of the mood of the average shopper. Helen Dickinson, head of retail at KPMG, sums up the falls outside London by noting that ‘All sectors, with the exceptions of food and homewares, which had nothing to write home about, delivered negative like-for-like sales across the month. Consumer confidence is on a knife-edge.’

Worryingly, the threat of 10,000 City job losses predicted for this year, as well as soaring food costs, points to persistent troubles ahead for London retailers in the lead-up to the crucial summer trading period.