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By James Davey
LONDON, Sept 9 J. Sainsbury, Britain's
third largest grocer, said it was too early to call an end to
the country's economic downturn, arguing strong trading over the
summer was no more than "a blip."
Sainsbury's and other British retailers are still taking a
cautious view of the market for the year ahead even though
official data and surveys have shown an improving outlook for UK
consumer spending, which generates about two-thirds of gross
British Retail Consortium data, for example, has suggested
Britons are feeling more confident about spending money.
"Whilst there are some economic signs that the economy is
improving, you're not yet seeing that evidenced in consumer
behaviour," Sainsbury's Chief Financial Officer, John Rogers,
told the Reuters Global Consumer and Retail Summit on Monday.
"The blip over the summer brought about by the very good
weather is just that - it's a bit of a blip," he said at the
Government austerity measures and low-wage growth since the
financial crisis have squeezed household budgets, making
shoppers cautious on spending.
Rogers said that in the run-up to Christmas he expected
consumers to return to the pattern of behaviour seen over the
last three years - saving money with a view to splashing out
over the festive period.
He said the key driver of a more sustained improvement in
consumer expenditure was a further narrowing of the differential
between inflation and wages inflation.
"Consumers are still in a place of tightening their belts,
watching how they spend and savvy shopping. All the patterns of
behaviour that we've seen evidenced over the last two to three
years we are not seeing any change in," he said.
British finance minister George Osborne said on Monday that
the UK economy has turned a corner and that its accelerating
economy vindicated the government's austerity programme.
Sainsbury's has been outperforming its "big four" rivals
Tesco, Wal-Mart's Asda and Morrisons,
with robust growth online and at convenience stores more than
offsetting underlying sales falls in its traditional stores.
In June, it reported first quarter like-for-like sales
growth of 0.8 percent, and maintained its guidance for full year
growth of 1.0-1.5 percent.
Sainsbury's was alone among the big four in growing ahead of
the market in the last three months, according to data from
For a Reuters digital TV interview with John Rogers please
click on reut.rs/17k5toN
Follow Reuters Summits on Twitter @Reuters_Summits
(Additional reporting by Neil Maidment. Editing by Jane