RETAIL sales are picking up sharply, a study from the Confederation of British Industry (CBI) showed yesterday, with firms’ expectations for next month at their highest level in 27 years.
Orders to suppliers rose at their fastest pace since December 2010 in May, while sales are well above average for the time of year – the last time sales were this strong was in April 2007, before the financial crisis.
Sixty per cent of respondents told the CBI their sales volumes were up on the year, with only nine per cent seeing sales fall. This net balance of 51 per cent is up on the 12 per cent net balance reporting a rise in April, and firmly ahead of expectations.
Grocers and recreational goods shops reported very strong growth, though hardware and DIY retailers saw a decline.
“Low inflation, which we expect to remain below one per cent for the rest of the year, has given household incomes a much-needed boost and greater spending power,” said the CBI’s Rain Newton-Smith. “Overall the outlook is bright for firms on the high street, but challenges still remain, especially for food retailers, who are still feeling stiff price competition from new entrants.”