Retail Sales Drop This Month

A new survey by the CBI business group has shown that retail sales have fallen again this month, hitting a 14 month low.

The group conducts a monthly distributive trade survey, which did show a sales balance of +13 in April, has now fallen to show -18 in May.

The survey is blaming the lull on a slowdown in the housing market reducing consumer demand along with the bad weather seen in the earlier parts of the month.

These retail sales figures for the early part of May are clearly disappointing," said Ian McCafferty, the CBI's chief economic adviser.

It is though that the poor weather is likely to have had a large impact on clothing sales as people begin to buy warm weather clothing ready for the summer.

In addition, Mr McCafferty said signs of "slowing momentum" in the housing market was likely to have been behind "renewed weakness in sales of big-ticket items and other household goods".

The CBI's reading was below what analysts had previously expected.

"The CBI survey reinforces our long-held concern that the upside for consumer spending, and hence growth, will be limited for some time to come as households still face very challenging conditions," said Howard Archer, chief UK economist at IHS Global Insight.

Posted at 03:21PM May 28, 2010 by Marc Stenton in The Economy  |  Comments[0]