UK retail sales in the run-up to Christmas were lower than a year ago for the first time in 10 years, the employers' organisation the CBI has found.

If the mood of consumers is still low into the New Year, then the outlook for the UK economy is seriously worrying Ian McCafferty, CBI

The study is likely to raise fears that UK consumer spending is finally beginning to weaken.

But the CBI pointed out that its survey covered sales between 4 and 18 December and so it was possible there had been a late surge in the last few days before Christmas.

And there was a sign that this may have been the case from department store group John Lewis, which said it had seen a "real take off" in sales in the three days before Christmas Day.

Sales worry

The CBI said that as well as disappointing sales in the run-up to Christmas, expectations for the January sales remained "modest".

"Retailers will be very concerned by these figures," said Ian McCafferty, the CBI's chief economic adviser.

"We will need to wait for the full picture but, without a last-minute surge in spending, this will have been a very disappointing Christmas.

"We must hope that consumers are simply deferring purchases until the January sales.

"If the mood of consumers is still low into the New Year, then the outlook for the UK economy is seriously worrying."

Rate watch

While stores selling furniture and carpets reported strong growth, sales of household goods, footwear, clothing, china and DIY items were all lower than a year earlier.

Overall the CBI found 34% of firms had seen a rise in sales compared with the previous year, while 37% had seen a fall.

The minus 3% balance was the first negative balance since January 1999 and the first fall in December since 1992.

Analysts said the surprisingly weak figure could lead to new calls for another cut in UK interest rates.

"The Monetary Policy Committee will be watching this keenly to see if there is any revival in January or February," said Philip Shaw, chief economist at Investec.

"Consumers have almost single-handedly propped up the economy over the past year or two and, during a period of what seems to be renewed global downturn, they still have to do their bit."

Sign of hope

John Lewis said the strong showing in the last few days before Christmas helped to make up for flat sales in earlier weeks.

Sales in the week to 28 December were up 7.9% on the same period last year, compared with 0.2% growth in the previous week.

The two weeks combined showed growth of more than 3%.

"This is somewhat less than we hoped when we set the estimate back in the spring," said Luke Mayhew, managing director of the group's department stores business.

"However, I believe it will compare well with other non-food retailers, particularly given that nearly 30% of our sales come from Greater London, where the market has not generally been favourable."