The 14th annual Christmas Retail Survey from Deloitte has shown that 57 per cent of UK consumers intend to spend the same this festive season as they did last year, while 24 per cent of respondents will spend less and 19 per cent will spend more.
"Although this Christmas may be one of the toughest in decades, retailers have been toughing it out for most of the year," said Tarlok Teji, head of retail at Deloitte. "We think the talk of Christmas being cancelled is overplayed. Whilst total planned spend including socialising may be down, the majority of consumers intend to spend the same as last year.
"Retailers will need to understand their consumers better than ever and offer relevant products to take a share of the Christmas wallet."
On average, consumers are planning to spend £655 on gifts, socialising, food and drink this year. This is seven per cent less than last year and, when compared to the seven per cent growth the year before, could be interpreted as a 14 per cent drop in confidence.
However, Richard Hyman, strategic advisor to the retail practice at Deloitte, believes it is unlikely that actual retail sales will fall significantly.
"Broadly speaking, we believe sales will be flat this Christmas with a slight fall possible."
One segment of the population is planning to buck the spending trend, however, with 36 per cent of 16 to 24 year olds intending to spend more. 49 per cent say they are going to have a good time at Christmas and worry about the cost later.