High street sales have collapsed in recent weeks as ‘Trumpflation’ fears see people keeping money in their pockets.
Shoppers are increasingly reluctant to spend, data from accounting firm BDO reveals.
By the end of March, sales were nearly 8 per cent lower than in the same period last year.
Retailers now face a ‘hugely painful period’ having already been hit by Labour‘s tax rises and an increase to the minimum wage.
BDO figures showed that overall retail sales eked out growth of 0.8 per cent overall in March compared to the year before.
Shoppers seemed willing to keep spending on the high street and online in the first half of the month even after the US and Israel launched their attack on Iran.
But as the conflict dragged on and its growing impact on the UK became apparent there was a ‘retail sales collapse’, BDO said.
Sales were down by 3 per cent, and then 7.7 per cent, in the last two weeks of the month, compared to 2025.
High street sales have collapsed in recent weeks as ‘Trumpflation’ fears see people keeping money in their pockets
Shoppers are increasingly reluctant to spend, data from accounting firm BDO reveals (Stock Photo)
As the impact of the Iran war on the UK has become apparent there has been a ‘retail sales collapse’, according to accounting firm BDO (Pictured: an air strike in Kuwait on Wednesday)
Sophie Michael, head of retail and wholesale at BDO, said: ‘It is now clear that this is going to be a hugely painful period for retailers.
‘They are navigating an already challenging trading environment, while facing further rises in national minimum wage and expanding employment rights, increasing labour costs, against a shrinking consumer purse and falling consumer confidence.
‘These factors create a perfect storm, adding further pressure on sales, margins and investment across the sector.’
Meanwhile, a Bank of England poll of more than 2,000 firms shows they believe inflation will climb from 3 per cent to 3.5 per cent over the coming year.