Sales slowest for 18 months
CBI survey confirms UK shoppers are in cautious mode
July 31 2002
UK retail sales are at their slowest for 18 months, according to the CBI’s latest monthly distributive trades survey.
Sales are average for the time of year, suggesting that shoppers have returned to normal spending habits after a boom period fuelled by low interest rates.
An expected acceleration in sales growth in July failed to materialise, with 44 per cent of firms reporting sales were up on a year ago while 28 per cent said they were down. The balance of plus 16 per cent in both June and July compares with plus 25 per cent in May.
The three month moving average, which smoothes out month-to-month fluctuations, fell to the lowest figure since December 2000.
Alastair Eperon, Chairman of the CBI’s DTS Panel and a director of Boots, said: “The retail sales boom seems to be over. Despite continuing price cuts and stiff competition on the high street, consumers are less willing to spend.
“Consumer confidence has been hit by worries over the impact of financial market volatility and uncertainty over house prices. There are increasing signs that the global economic recovery is fragile. The Bank of England can safely leave interest rates on hold. Firms need stability in order to make the recovery a reality.”
Growth weakened for grocers and in the footwear and CTN sectors. Booksellers and stationers reported the sharpest drop in sales. Firms selling household goods continued to perform well, with sales growth also increasing for retailers of furniture and carpets, specialist food and pharmacists.
