Andrea Felsted is a Bloomberg Gadfly columnist covering the consumer and retail industries. She previously worked at the Financial Times.

Shoppers are showing a little Christmas cheer. The fact that GfK's consumer confidence index stopped deteriorating adds weight to the prospect that the holiday won't be a turkey for retailers. But neither will it be much of a sparkler -- and that will be as good as it gets.

GfK's headline confidence gauge ticked up one point in December, to minus 7. The broad trend is that Britain's vote to leave the European Union has weighed on sentiment, though it's nowhere near the lows of around minus 34 seen during the financial crisis.

Hurt Feelings
GfK's headline consumer confidence index stayed negative in December, and peoples' sentiment on their future financial situation deteriorated
Source: GfK

GfK's subindex of how inclined consumers were to make major purchases improved, which is more surprising. That may not last. 

If incomes get squeezed, which is likely given that inflation is set to rise, then big-ticket purchases such as new kitchens and TVs could be the first to go. They have been major beneficiaries of consumers' improved spending power over the past two years. A less-certain outlook for incomes also raises questions on purchases of these items.

Nice While it Lasted
U.K. consumers' perception of the environment for buying white goods improved in December, but a squeeze on incomes next year could shift that view
Source: GfK

Indeed, shares in Dixons Carphone Plc have fallen 6 percent over the past week, after its usually upbeat Chief Executive Officer Sebastian James said the company was planning for the possibility of tougher times ahead.

Choppy Waters Ahead
Shares in Dixons Carphone slipped after it warned it was planning for uncertain times
Source: Bloomberg

And many clothing retailers have started their main winter sales already.

Aside from Next Plc, which never discounts before Christmas, there's a notable exception: Marks and Spencer Group Plc. Although it had gone half price on some Christmas gifts, as of Thursday, main categories such as womenswear and nightwear remained at full price. In past years, it has been forced to engage in panic discounting days to boost trade.

Happy Holidays
Investors in Marks and Spencer are hoping it will avoid the ghost of Christmas past disasters
Source: Bloomberg

The shares are up 12 percent since it reported half-year profit in November. Investors appear to be betting on a stronger holiday season for new Chief Executive Officer Steve Rowe than it's seen in recent years.

But as Gadfly has argued, this might be Britons' last spending splurge. Christmas 2017 might be much less of a cracker.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

To contact the author of this story:
Andrea Felsted in London at

To contact the editor responsible for this story:
Jennifer Ryan at