Retail activity falls less than feared - CBI

Retail activity among larger high street operators weakened less than expected this month, according to the latest industry survey by the CBI.

The CBI monthly distributive trades survey found the balance of retailers reporting higher sales volumes over those reporting lower sales volumes fell to 23 in September from 29 a month earlier, but not as low as the market's expected balance of 16.

The balance came from 31% of respondents reporting that sales volumes were up on a year ago, while 9% said they were down.

Growth in sales volumes was reported in the durable household goods, hardware & DIY, internet and mail order, and other normal goods sub-sectors but fell for department stores, footwear & leather, chemists and recreational goods sub-sectors.

“As we head into Autumn, retailers have seen the run of decent sales figures continue. But underlying conditions are clearly tougher, with the sector facing significant challenges – from squeezed household incomes, changing consumer habits to digital disruption," said Anna Leach, CBI economic intelligence chief.

Although the summer months seem to have provided a boost to retailers after a weak first quarter, the CBI expects momentum to be "relatively subdued going forward as firms continue to grapple with anaemic growth in real household earnings and structural changes such as digital disruption and new market entrants".