Retail sales rebound at fastest pace in two years
Consumers defied warnings of increasingly squeezed household budgets in September as 56% of retailers reported an increase in sales compared with a year ago.
Retail sales rebounded to grow at their fastest pace for two years in the year to September as consumers defied warnings of increasingly squeezed household budgets.
Some 56% of retailers reported an increase in sales this month compared with a year ago, while 15% said they were down, giving a balance of +42% – the highest since September 2015, according to the CBI Distributive Trades Survey of 117 firms.
Looking ahead, 37% of those polled expect another increase in sales next month in comparison to the 14% who expect a decrease.
Internet sales volumes also continued to expand in the year to September and at a faster pace than last month, up 54% compared with 34% in August and above the long-term average of 48%.
Grocers’ sales volumes rose strongly, up 49%, and clothing retailers also performed well with sales up 75%.
More than half of motor traders (52%) reported sales were up on a year ago. None of those surveyed reported a drop in sales volumes.
Meanwhile, orders placed with suppliers also rose in the year to September, rebounding from a fall in the previous month, with retailers expecting continued growth in both sales and orders in the year to October, albeit at a slower pace.
Anna Leach, CBI head of economic intelligence, said: “It’s encouraging to see some vigour returning to the retail sector in September, with sales growth picking up from August and consumer demand expected to hold up reasonably well next month.
“But inflation continues to squeeze household budgets, and with the pressure on incomes set to persist, retailers will continue to face a challenging environment.
“The Government has the opportunity to provide a fillip for retailers in the forthcoming Budget – particularly those maintaining a physical presence on the High Street – by bringing forward the switch in the indexation of business rates from RPI to CPI.”