The bombs in London this month are unlikely to have a big impact on the economy, the country's top employers' group said today.
The Confederation of British Industry said experience from the September 11, 2001 attacks on the US and on Madrid in 2004 indicated there was no cause to fret about the economy after suicide bombers killed more than 50 people in London on July 7.
"Evidence we have from 2001 and Madrid suggests that the impact on economies as a whole of such atrocities tends to be limited," said Ian McCafferty, CBI Chief Economic Adviser.
"Central London retailers recorded a drop in sales on the weekend after July 7...but there are issues about what people are spending their money on," McCafferty told a news conference.
However, London retailers are worried that fears of a prolonged bombing campaign in the capital could discourage tourists from visiting the city and take a large chunk out of sales, already weakened by reluctant consumers.
"There will be an economic impact and we have to address that quickly," said Jace Tyrrell, a spokesman at New Westend Company, which represents retailers in the city's renowned Oxford Street area.
Some 200 million shoppers visit London's world-famous shopping district each year, spending around £5.5 billion between them, he said. That is over ten percent of total retail sales in London.
Fashion chain Monsoon Plc is worried about business in the coming months after the attacks.
"We are also concerned about the impact of recent incidents and the general prediction of the lack of consumer confidence on the high street," Monsoon chairman Peter Simon said on Monday.
The GfK consumer confidence survey for July, to be published on Friday at 0930 GMT, will provide a first glimpse of consumer sentiment after the attacks and a gauge on the spending outlook.
Data so far suggest retailers have good reason to be concerned.
Retail metrics group SPSL said last week's attempted bomb attacks on London knocked back the number of shoppers in the capital, just as they were picking up after the deadly attacks on July 7 and expects the fear of further attacks to deter visitors.
The number of shoppers on Friday, July 22 was down 19.1 percent on the year and 21.9 percent year-on-year on Saturday July 23.
Still, SPSL and other experts say that while consumers may be more reluctant to go shopping in London as a result of the attacks, they will probably spend their money elsewhere, leaving only a small net impact on retailers.
Department store chain John Lewis said sales at its flagship branch on Oxford Street were weaker than sales at its stores in out-of-town shopping centres Brent Cross and Blue Water in the weeks after the July 7 attacks.
And CBI's Ian McCafferty said that while past experience showed people became more reluctant to spend on travel or on eating out after attacks on cities, there was evidence consumers might spend more money on their homes instead.
"Retail sales will be weaker in July but I don't think this is a sign of significantly lower growth as a result of the attacks," he said.