An Amazon spokesperson has responded to the protests taking place today:
“These groups represent a variety of interests, and while we are not perfect in any area, if you objectively look at what Amazon is doing on these important matters you’ll see that we do take our role and our impact very seriously.
We are inventing and investing significantly in all these areas, playing a significant role in addressing climate change with the Climate Pledge commitment to be net zero carbon by 2040, continuing to offer competitive wages and great benefits, and inventing new ways to keep our employees safe and healthy in our operations network, to name just a few. Anyone can see for themselves by taking a tour at one of our sites.
Summary
A quick recap:
Tesco CEO: Cost of living support should be more targeted
The boss of Tesco has called on the UK Government should make cost-of-living support “more targeted” for the vulnerable as he warned over food poverty.
Ken Murphy, chief executive of the supermarket giant, told PA Media he has seen positive signs of shopping behaviour in Tesco stores since energy bill support was handed out to UK households from October.
However, he suggested that improvements could still be made to financial support.
Murphy said:
“It looks like the action by the Government has helped but I believe it can be more targeted in the form of who it helps, to help the vulnerable.
“There should be a case for more means testing with support.
“There is a certain responsibility that should be shared by businesses, government and communities to help those most at need.”
On Tuesday the OECD also criticised the government’s untargeted subsidy of household energy bills, saying it would lead to higher interest rates and raise debt service costs.
2023 to be most challenging year for UK housing market since 2008
Analysts at Bank of America’s Global Research says they expect 2023 to be the most challenging year for UK house builders since the 2008 global financial crisis
BofA downgraded Taylor Wimpey to “underperform” from “buy”, and also lowered their rating on Redrow and Persimmon to “neutral” from “buy”
Reuters has more details:
Broker notes that the housing market sector “learnt valuable lessons in 2008 and has acted with more restraint in the lead-up to this downturn, leaving it on a strong enough financial footing” to weather the downturn it sees in 2023-2024 estimates
At prevailing inflation and interest rate expectations, brokerage takes a largely neutral view on the sector but warns that risks remain firmly to the downside
Wall Street has made a mixed start to trading, following Thursday’s Thanksgiving break.
The Dow Jones industrial average has gained 0.25%, or almost 90 points to 34,283 points.
DIY group Home Depot are leading the risers, up 1.4%, but Apple have dropped almsot 2% following reports that iPhone production at Foxconn’s factory in China’s city of Zhengzhou could fall at least 30%, due to worker protests (see details here).
Black Friday footfall below pre-pandemic levels
Shopper numbers at UK retailers are sharply below 2019 levels, despite an increase compared to last year.
Data provider Springboard reports that retail footfall was 7.3% higher this morning than last Friday, suggesting Black Friday bargains have lured some shoppers out. Shopping centres were almost busier, while high streets only recorded around 4% more visitors that last week.
On an annual basis, total footfall by noon was 4.6% higher than last year, but over 22% lower than in 2019 – the last Black Friday before the pandemic.
So while electronic transactions may be a third higher than in 2019, according to Nationwide, fewer people are visiting retail outlets.
That reflects the impact of the cost of living squeeze, but also the move towards home working – meaning fewer people will be nipping out of the office to shop.
#BlackFriday footfall figures until 12pm from @Springboard_
— Dan Martin (@Dan_Martin) November 25, 2022
Footfall across all UK retail destinations 7.3% higher than last Friday.
Shopping centres +13.9% higher than last Friday.
Footfall +4.6% than Black Friday 2021 across all destinations. +8% higher in high streets. pic.twitter.com/ZGOQ2DibN3
Diane Wehrle, insights director at Springboard, says shopping centres are the Black Friday winners so far.
Shoppers are heading to large city centres rather than smaller high streets, with footfall in Central London +11.1% higher than last week and +7.7% higher in city centres across the UK compared with a drop in footfall from last week of -3.2% in market towns.
The footfall data demonstrates that whilst trading conditions are challenging Black Friday is certainly not a disaster.
Springboard expect footfall to strengthen this afternoon as those consumers who are working from home go shopping after lunch.
The dry and sunny weather will also help drive up activity, as will the UK vs USA World Cup match this evening as shoppers may well head into towns and cities and do some shopping and then watch the match from bars in town centres.”
Updated
The worker unrest at Foxconn’s plant in China could reportedly weigh on Apple’s November iPhone shipments with full production yet to resume until the end of the month.
Victoria Scholar, head of investment at Interactive Investor, explains:
Apple has been battling with China’s draconian zero-tolerance to Covid approach to try to combat its record high infection levels. This has been having a negative impact on China’s exports with many businesses moving their factories to other Asian economies instead.
More broadly, it is weighing on China’s growth outlook, which when coupled with its embattled real estate sector and the regulatory threat to its tech sector could suggest China is past its peak.
This is likely to have negative reverberations for global GDP as China is a key trading partner to the world.
As we covered earlier, the People’s Bank of China cut its reserve requirement ratio (RRR) by 0.25 percentage points this morning to try to bolster demand and kickstart growth and offset some of the pressures from covid lockdowns and its property crisis.
Apple’s shares are trying lower by nearly 1% ahead of the US market open as stocks prepare to play catch-up after the Thanksgiving holiday.
Scholar adds:
Although Apple is down 17% year-to-date, it has outperformed some of the other tech giants like Meta and Amazon which are nursing heavier losses of 66% and 45% respectively.
Apple is still viewed as one of the more resilient stocks in the tech sector with fiscal fourth quarter earnings and revenue topping Wall Street’s expectations in October. However, Apple continues to hold off from providing official guidance given the macroeconomic uncertainty.
Updated
UK retailers appear to have seen a steady, if muted Black Friday morning.
Updated figures from Nationwide show that its members had made 16% more transactions than on a typical Friday by noon – still 7% more than last year.
Mark Nalder, Director of Payment Strategy at Nationwide Building Society says:
Historically this period has been the peak time for spending as people search for bargains either online on the high street during their lunch break.
“For the first time ever we also have a winter World Cup, which will continue to boost spending figures throughout the day – especially when England take on the USA later this evening.”
Updated
Elsewhere in the world economy, Mexico has continued to grow despite the pressures from higher interest rate and the global slowdown.
Mexico’s GDP rose by 0.9% in the third quarter of 2022, with growth led by the primary sector (such as mining and agriculture).
The Gross Domestic Product (GDP) in Mexico expanded 0.90 percent in the third quarter of 2022 over the previous quarter. https://t.co/jZz1k45Vp7 pic.twitter.com/tGbWDKsWQs
— Trading Economics (@tEconomics) November 25, 2022
The good news for consumers is that retailers have been compelled to offer steep discounts to lure shoppers.
That, though, will eat into profit margins at a normally lucrative time of the year.
In fact, retailers across Europe fear the overall Christmas trading season could be the worst in at least a decade.
US retailers Target Corp, Macy’s and Best Buy have all warned of steeper discounts this November and December than in the previous two years. More here.
Black Friday may offer an opportunity to bag a bargain ahead of the festive period, but many shoppers will be expecting retailers to cut prices more than usual.
The worsening cost-of-living crisis means shoppers in the UK and continental Europe will be determined to find solid reductions.
Research from Boston Consulting Group has found that shoppers in Europe plan to spend almost one-fifth less during this year’s annual discount period, due to the squeeze from inflation.
UK consumers are set to cut back by the greatest margin in the region, spending 18% less, while those in France and Germany both plan to reduce their spend by 15% and Spain by 13%.
US shoppers expect to spend around 6% more, though. More here.
U.S. shoppers alone in boosting Black Friday spend as cost-of-living crisis hits Europe https://t.co/gKIoG32F5v
— CNBC International (@CNBCi) November 24, 2022
There has been a marked slowdown in the UK housing market since the mini-budget in September, an estate agent group has warned.
LSL Property Services told shareholders that market conditions have been more challenging than previously expected, following a strong first-half of the financial year.
It said the mortgage and housing markets had being disrupted by political uncertainty and sharply increasing interest rates.
Across the market, this has given rise to a reduction in mortgage activity and new house sales, and an increase in fall-throughs of previously agreed sales.
Shares in LSL have fallen 11% – dragging on the housebuilding sector too.
Over in France, members of the CGT union have been demonstrating at Amazon’s logistics center in Bretigny-sur-Orge, near Paris, as part of the global day of action.
They put up a banner reading “En grève pour nos salaires”, which means “On strike for our wages”.
Updated
Britain’s cost-of-living crisis is hurting those in the most deprived areas hardest, new official data shows.
People living in the most deprived areas in England are more likely to be cutting back on food and essentials (58%) compared with those living in the least deprived areas (33%).
They’re also much more likely to have fallen behind paying their energy bills, and less likely to have invested in energy efficiency improvements.
Although not a surprise, it highlights how poorest households need help to get them though the worst cost of living squeeze in decade.
94% of adults said their #CostOfLiving had increased compared with a year ago 📈
— Office for National Statistics (ONS) (@ONS) November 25, 2022
76% said it had increased over the past month – up from 62% a year ago.
This latest data is for the period 8 to 20 November 2022.
➡️ https://t.co/mJ0EOmaiP1 pic.twitter.com/SLLS2CHuBm
The Office for National Statistics also found that the vast majority of adults in the UK reported seeing the price of their food shop rise over the past month.
84% of those living in the most deprived areas of England were worried (very or somewhat) about the rising #CostOfLiving.
— Office for National Statistics (ONS) (@ONS) November 25, 2022
This figure was 70% for those living in the least deprived areas. pic.twitter.com/s6DSh6fU1B
70% of those living in the most deprived areas of England were worried (very or somewhat) about keeping warm in their home this winter.
— Office for National Statistics (ONS) (@ONS) November 25, 2022
This figure was 46% for those living in the least deprived areas. pic.twitter.com/ENF7aT8g9F
58% of those living in the most deprived areas of England reported spending less on food and essentials.
— Office for National Statistics (ONS) (@ONS) November 25, 2022
This figure was 33% for those living in the least deprived areas.
➡️ https://t.co/mJ0EOmaiP1 pic.twitter.com/3rjga7w6QB
The volume of UK Black Friday payment transactions by 10am was broadly in line with 2021, initial data from Barclaycard Payments shows (via Reuters).
Marc Pettican, head of Barclaycard Payments, said.
“Our data shows that Black Friday is off to a steady start this year, despite the challenging economic backdrop.
Updated
Nationwide: Black Friday to be busiest shopping day of the year
Consumer spending this morning is up around a sixth on a normal Friday, according to date from Nationwide building society.
By 9am, Nationwide members had made 1.37 million transactions – 17% higher than a typical Friday.
That’s about 7% more than on Black Friday in 2021, despite cost of living pressures.
The lure of a Black Friday bargain ahead of Christmas is “clear to see”, says Mark Nalder, Director of Payment Strategy at Nationwide Building Society:
“Early indications are that this Black Friday will be the busiest shopping day of the year.”
Live Black Friday spending data - 9am update: 1.37m transactions made so far today - 17% higher than an average Friday. Number of purchases made is 7% higher than on Black Friday last year. #spending #BlackFriday #costofliving https://t.co/ny9pqczo9O
— NBS External Affairs (@NationwidePress) November 25, 2022
Nationwide tell us that Black Friday transactions are up 35% compared with 2019. One change, though, is that the pandemic has accelerated the move towards card payments rather than cash….
Buying online this #BlackFriday or #CyberMonday? Here are some scam red flags to look out for to ensure you're safe 🚩
— Nationwide Building Society (@AskNationwide) November 24, 2022
📆 Website launched days/weeks ago
💳 Unsecure payment method
💸 Price is too good to be true
⏱️ Countdown to rush you into a decision pic.twitter.com/OewcifhZsT
Black Friday could be a lifeline for retailers ahead of a potential rise in insolvencies early next year.
Owen Bassett, retail expert and underwriter manager at Atradius, which provides trade credit insurance, says Black Friday is “hugely important for retailers this year”.
Consumer demand has been relatively low until this point, and people are having to make tough decisions around where they spend their money in light of the soaring cost of living. Black Friday is an opportunity for retailers to entice them to loosen their purse strings.
“Businesses will be hoping to utilise Black Friday promotions as an opportunity to clear through excess stock that they are holding onto and generate cash in order to improve their prospects for the year ahead.
After a relatively subdued period for retail insolvencies due to lasting Covid-19 government support, we’re seeing numbers creep up, and if retailers fail to effectively manage their inventory and supply chain, we could be faced with an influx of insolvencies in the sector in the Q1 of 2023.”
Just in: China’s central bank has cut its benchmark interest rate, as concerns over rising Covid-19 cases mount.
The People’s Bank of China has lowered its Reserve Requirement Ratio rate by a quarter-point, which will allow banks to lend more money to support the economy.
BREAKING: China cut RRR by 25bps (first cut since April) releases 500b RMB of liquidity but PBOC say they will 'not resort to flood-like stimulus'
— Joumanna Bercetche 🇱🇧 (@CNBCJou) November 25, 2022
This as covid cases mount, outlook for economy worsens
Yesterday, China imposed a fresh series of Covid lockdowns after recording a record daily high in coronavirus cases.
Amazon strikes and protests planned in Germany
Work stoppages were planned at 10 Amazon fulfilment centres in Germany, according to the Verdi union, as part of a global day of strike action across the company’s operations.
Verdi demands Amazon recognise collective bargaining agreements for the retail and mail order trade sector and called for a further collective agreement on good and healthy work.
A spokesperson for Amazon in Germany would not immediately comment on the demands when contacted by Reuters.
“This is the first time that Amazon has had an international strike day,” said Monika Di Silvestre, Verdi’s representative for Amazon workers, adding:
“This is very important, because a major global corporation like Amazon cannot be confronted locally, regionally or nationally alone.
Greenpeace activists have already protested at Amazon’s Munich headquarters:
There have been protest against Amazon in New Delhi today, accusing the company of treating workers unfairly.
Unions in India have been pushing the tech giant for higher minimum wages, reduced working hours, fixed-term contracts, and better working conditions, Business Standard reports.
Parminder Jeet Singh, executive director at IT for Change, said:
“Amazon has become a global giant exercising a completely new model of exploitation.
It is a prototype and the main sign of a new kind of global corporation, which remotely controls all activities of a sector. It becomes a new paradigm of granular control, which creates exploitative conditions for workers and traders.
Jaguar Land Rover cutting production at UK factories until spring
Newsflash: Jaguar Land Rover is cutting production at its UK factories until the spring, my colleague Jasper Jolly reports.
It’s a sign of JLR’s continued struggle to source semiconductors amid the global shortage.
The carmaker, whose chief executive, Thierry Bolloré, last week announced his resignation, has decided to cut production at factories in Solihull and Halewood between January and the end of March as it tries to prioritise its most profitable models, said industry sources.
JLR and other carmakers have been plagued by shortages of semiconductors since early 2021.
Many carmakers cut their orders for the computer chips at the start of the coronavirus pandemic, only to find themselves at the back of the queue when demand roared back.
Here’s Jasper’s story:
Updated
Tips for avoiding Black Friday scams
Cyber-criminals target Black Friday to trick consumers looking for bargains – so here are three threats to watch out for (from website Hey Discount).
1. Suspicious links in websites, emails and text messaging
There are a few ways you can check a link that appears in a text or email. The best way to tell is by examining the sender’s information, you can do this by clicking on the contact information of the sender, examining the email address or phone number, and checking that it matches up with the company it claims to be.
If you notice any strange email addresses or unidentified contact numbers, there is a chance that it is a potential scam.
2. Unfamiliar Websites
Many scammers will set up fake websites with fake products listed to retrieve your bank details and information. While shopping online, opt to use an internet browser that uses advanced technology, and look out for the padlock icon within the site’s URL bar at the checkout, as this helps protect your information.
You can also use other websites to check the legitimacy of the seller, but ultimately it’s best to stick to familiar websites, especially around this time of year.
3. Verification Code and Delivery Service Scams, designed to evade two-step authentication
These messages usually pretend to be your bank or a company you’ve recently made an order with. These messages will typically ask you to finish your transactions by inputting a verification code. Fake delivery messages, sometimes disguised as the Post Office and other well-known delivery companies, are also common during the Black Friday period, detailing information about a product you have recently purchased, asking you to click a link and pay a delivery fee to retrieve items that haven’t yet been delivered.
Our advice would be to be cautious of any text messages you receive beyond the checkout, and to always double-check you’ve received an order confirmation via the email provided at the point of order to ensure your purchase has definitely gone through.
Some economic good news – Germany’s economy grew a little faster than first thought in the last quarter, which may ease fears of a deep recession.
German GDP expanded by 0.4% in July-September, up from an earlier estimate of 0.3%.
It means Europe’s largest economy managed to keep growing through the first three quarters of 2022, despite ongoing Covid-19 disruption, supply bottlenecks, surging energy prices, inflation, and the war in Ukraine.
German GDP growth in Q3 was even better than in flash estimate: 0.4% QoQ, from 0.3%. That’s a surprise. Growth was driven by government and private consumption. Net exports and construction sector were drag on growth. https://t.co/sf41uVUAG4
— Carsten Brzeski (@carstenbrzeski) November 25, 2022
Shares in UK homebuilders have dropped in early trading in London, amid worries that a recession and rising borrowing costs will hit the housing market.
Persimmon (-2.4%) and Taylor Wimpey (-2.4%) are the top FTSE 100 fallers, with Barratt Development down 1.7%.
Analysts at Berenberg have cut their share price targets for the housing sector this morning.
Also, a Rightmove survey has found that demand for rental homes across the UK has jumped. Some potential first-time buyers are putting their home-buying plans on hold in the hope that mortgage rates will drop in the new year.
That’s driving up rental prices – a blow to tenants (which will leave them with less disposable income for Black Friday).
Energy regulator Ofgem has been accused of an “abdication of responsibility” after announcing a package of reforms designed to bolster consumer protection and ensure energy suppliers are more resilient to market shocks.
Oftem says its new rules will shield households, after taxpayers had to pick up a £9.2bn bill after nearly 30 suppliers went bust.
The boss of Centrica, though, has criticised Ofgem for failing to protect consumer deposits, warning:
“If and when a large supplier fails, the recklessness of the decision not to address this issue will be clear for all to see.”
UK businesses may have to offer more aggressive discounts than usual, to encourage shoppers to spend this Black Friday.
But that will eat into profit margins, as Victoria Scholar, head of investment at Interactive Investor, explains:
Businesses will be desperately fighting it out for the slimmed down collective pot of potential consumer spending.
However, businesses have also been facing a big increase in costs from energy to wages to materials. This troublesome combination of increased costs and higher discounts will put pressure on margins, making it increasingly tough for retailers to remain profitable.
They may also struggle with a hangover of too much inventory if sales fall short of expectations, potentially resulting in even more discounts after Christmas into the new year and even tighter margins.
Protests planned at Amazon's UK warehouses
In the UK, workers associated with GMB union have planned protests outside Amazon’s warehouse in Coventry.
Protests are also expected outside the company’s Dublin offices to push back against two new planned data centres in the city.
The Irish Times has more details:
“Amazon workers in Coventry are overworked, underpaid and they’ve had enough, said Amanda Gearing, a senior GMB organiser, adding that hundreds will assemble to demand a wage increase from £10.50 an hour to £15.
Any workers who walk out during a shift could lose out on the second half of a £500 bonus that Amazon announced for UK warehouse workers last month. The final payment is contingent on staff taking no unauthorised absence between November 22nd and December 24th.
The GMB has said linking payments to attendance could be interpreted as unlawful inducement not to strike.
Amazon faces Black Friday protests and strikes in 40 countries https://t.co/BfnKcpSJb6
— The Irish Times (@IrishTimes) November 24, 2022
Amazon faces Black Friday protests and strikes
Thousands of Amazon warehouse workers across about 40 countries plan to take part in protests and walkouts to coincide with Black Friday sales today, campaigners say.
Employees in the US, UK, India, Japan, Australia, South Africa and across Europe are demanding better wages and working conditions as the cost-of-living crisis deepens, in a campaign dubbed “Make Amazon Pay.”
The campaign is being coordinated by an international coalition of trade unions, with the support of environmental and civil society groups.
Christy Hoffman, general secretary for UNI Global Union, says:
“It’s time for the tech giant to cease their awful, unsafe practices immediately, respect the law and negotiate with the workers who want to make their jobs better.”
More here: Amazon Faces Black Friday Protests, Strikes in 40 Countries
🛍Behind every discount, we should not forget that workers are being paid poverty wages for the clothes they make and that we wear.
— Jude Kirton-Darling (@Jude_KD) November 25, 2022
On #BlackFriday, @industriAll_EU joins the call for living wages #GoodClothesFairPay 
Sign the petition: https://t.co/0vZPT3yERo
Black Friday is “the last day of Rome stuff” for major shopping chains, argues City strategist Bill Blain of Shard Capital.
He says big retailers are:
…desperately marketing otherwise unsalable goods at suspicious mark-downs, and arranging consumer loans so they buy it.
Black Friday is an enormous marketing scam! Avoid it and shop local!
https://t.co/cXIhdyUxTm
— Bill Blain (@Bill_Blain) November 25, 2022
We’ve all been scammed into believing Black Friday is a boon for consumers – it’s a marketing scam. What else might lurk around the corner in terms of free stuff? How about abundant and free energy. Careful what you wish for.#markets #investing #economy
Black Friday warning as most deals are not cheaper – Which?
Black Friday bargains may not be as good as they seem, consumer group Which? warned this week.
The Evening Standard has the details:
Just one in seven Black Friday deals offer a genuine discount and the vast majority of promotions are cheaper or the same price in the six months before the sales event, a study has found.
Which? analysed 214 Black Friday deals last year across seven major retailers – Amazon, AO, Argos, Currys, John Lewis, Richer Sounds and Very – looking at their prices every day in the six months before and after last year’s event on November 26.
The watchdog found 183 (86%) were cheaper or the same as their Black Friday price in the six months before the event and 209 (98%) were cheaper or the same price at other times in the year.
None was cheaper on Black Friday alone.
Which? concluded that although there were some deals to be had on Black Friday, genuine discounts were “often few and far between”.
More here: Black Friday warning as most deals are not cheaper – Which?
A poor Black Friday would be a bruising blow to retailers, as the UK slides into recession.
Richard Flax, chief investment officer at digital wealth manager Moneyfarm, says:
‘In the minds of many, the words ‘Black Friday’ induce thoughts of excess, with shoppers frantically running through aisles or slamming keyboards to secure as many bargains as possible.
However, with inflation running at record levels and the UK already in a technical recession, this year’s shopping love affair may look a little different. According to research from GlobalData, it’s predicted that with inflation taken into account Britons will spend less in the two-week Black Friday period than in previous years.
If such forecasts prove to be correct, it will add further pressure on retailers, many of whom are already feeling the burden of an extended period of market volatility, supply chain disruptions and a hangover from the pandemic.
People are prioritising buying essential domestic products this year, and trying to cut their energy bills, reports Ed Connolly, chief commercial officer at Currys.
He told Radio 4’s Today Programme that there is higher demand for items such as microwave ovens, and also energy-efficient products such as heat pump tumble dryers.
Connolly added:
This is definitely the year of the air fryers.
We’re selling two and a half thousand a day, as soon as we can get the stock in people are buying it, because it’s a very energy-efficient way of cooking.
It’s here!
— Kate Hardcastle MBE (@katehardcastle) November 25, 2022
Expecting Black Friday sales to be ⬆️ but shifting trends such as recommerce & focus on products like air fryers & electric blankets to help with rising fuel costs
Have you already bought? Playing “the long game”? Or not shopping@CustWhisperer
📸@BBCWorld pic.twitter.com/dzz1Rjq8zu
Updated
Over half of Britons expect to cut back on spending this Black Friday compared to last year, research company Attest reports.
It found that most people expect to buy something, but are unsure how much they’ll spend.
Nearly two-thirds plan to only shop online – a potential blow to high street retailers who have put effort into store displays:
In a new blow to retailers on Black Friday, research published this morning suggests a third of families are planning to cut back on Christmas presents this year, because of the cost of living crisis.@julietdunlop reports pic.twitter.com/YmZCp0Eu79
— Good Morning Britain (@GMB) November 25, 2022
Updated
Introduction: Black Friday could be bleak as consumers cut back
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
The stakes are high for retailers today, as they try to tempt shoppers to spend with a flurry of Black Friday offers.
But they could face a “Bleak Friday” this year, economists say, as the cost of living crisis means consumers will resist discounts on new electronics kit, homeware, clothing and the like.
Plus, ongoing strikes at Royal Mail could deter people from shopping online.
Bleak Friday
— Kay Burley (@KayBurley) November 24, 2022
How will Black Friday be impacted by postal worker strikes? @DaveWardGS says they have no choice.#KayBurley FC pic.twitter.com/vJmDdR7oFd
Black Friday, originally an American post-Thanksgiving wheeze, is now more of an global event – thanks to international retailers looking to kick-start the festive rush.
These days, ‘Black Friday’ deals often last at least a week – running into the pre-Christmas offers, and then the January sales. But some of the offers may not be as generous as they look (and may get more generous once retailers get desperate to shift stock).
The CEBR thinktank reckons we could see a “Bleak Friday”, with discounts unlikely to save struggling retailers as UK consumers cut back spending by an estimated £1.5bn in the last quarter of this year.
The CEBR say:
The cost-of-living crisis, combined with warnings that discounts are often more generous at other times of year and the threat of a Royal Mail strike, will mean that it is a weak year for Black Friday sales and we may see January sales start early in an attempt to shift stock.
Black Friday can also suck in spending that would have happened anyway, either before or after the big day/week. This year, people simply have less disposable income to spend at all, with surveys showing many households are cutting back on spending.
The CEBR says:
While 42% of Brits have reported shopping around more due to the rising cost of living, suggesting they are looking for discounts, a higher share, 65%, reported they are spending less on non-essentials due to these cost pressures.
It’s the first Black Friday without Covid restrictions since 2019, which ought to help retailers get customers into shops. But sales and profits could still be lower than 2021.
As Danni Hewson, AJ Bell financial analyst, put it:
“Friday should be one of the busiest days for UK retailers but concerns about constrained budgets and the added issue of a strike by Royal Mail workers are both expected to make the affair a rather damp squib.
Retail expert Richard Lim told the BBC he was expecting Black Friday to be a more “muted affair” with sales down on last year.
Lim said:
“Inevitably, I think what we’re going to see is consumers being much more careful with their spending.”
Black Friday: Cost of living crisis may hit sales rush https://t.co/8jqJ8xUkUF
— BBC News (UK) (@BBCNews) November 25, 2022
Also coming up today
Retail giant Amazon faces a wave of Black Friday protests and strikes, as workers stage walkouts over pay and conditions (more on that shortly).
AMAZON FACES BLACK FRIDAY PROTESTS, STRIKES IN 40 COUNTRIES; WORKERS PLAN TO STAGE WALKOUTS OVER PAY AND CONDITIONS: BBG
— FXHedge (@Fxhedgers) November 25, 2022
Royal Mail staff will be picketing outside the postal groups offices again today, in an ongoing dispute over pay. Eight more days of action are planned in the run-up to Christmas.
The UK’s wave of industrial action has deepened, with nurses announcing they will strike for two days next month.
Royal College of Nursing members will stage national strikes – the first in its 106-year history – on 15 and 20 December, with action expected to last for 12 hours on both days.
The unprecedented industrial action will seriously disrupt care and is likely to be the first in a series of strikes over the winter and into the spring by NHS staff, including junior doctors and ambulance workers.
European financial markets could be subdued, with Wall Street reopening for a half-day after Thursday’s holiday.
European Opening Calls:#FTSE 7469 +0.04%#DAX 14555 +0.10%#CAC 6705 -0.04%#AEX 723 -0.01%#MIB 24726 -0.02%#IBEX 8390 +0.02%#OMX 2108 +0.05%#SMI 11158 +0.00%#STOXX 3963 +0.03%#IGOpeningCall
— IGSquawk (@IGSquawk) November 25, 2022
The agenda
7am GMT: Germany’s Q3 GDP report (final estimate)
7.45am GMT: French consumer confidence report
9.30am GMT: Latest UK public opinions and social trends report
Noon GMT: Mexico’s Q3 GDP report
Updated
