Retail sales fell for the fifth consecutive month in September but at a much slower pace than the month before, new data shows.
The Confederation of British Industry’s (CBI) Distributive Trades Survey showed 20 per cent of retailers said sales volumes in September were up on the same period last year, against 34 per cent who said they were down – giving a balance of minus 14 per cent.
This was better than last month’s predictions for September, which showed a balance of -21 per cent expecting a fall, and the recorded fall in August of -44 per cent.
Despite the drop, sales volumes were still seen as slightly above average for the time of year. Retailers also expect the downturn to moderate further next month, with a balance of -8 per cent expecting a decline in sales.
Martin Sartorius, CBI principal economist, said: “There are some elements of optimism in our survey with retailers expecting the recent fall in sales to continue to ease.
“Last week’s lower than expected inflation figures, which in turn will ease pressure on household budgets, will also give retailers some hope going into the crucial autumn and winter trading period,” he continued.
The survey comes a week after new data showed consumer spending was remaining resilient in the face of rising interest rates. Retail sales volumes rose by 0.4 per cent in August 2023, partially recovering from a fall of 1.1 per cent in July 2023.
The increase was driven by non-food sales, which grew by 0.6 per cent in August 2023, following a fall of 1.2 per cent in July 2023 thanks to unseasonably wet weather.
Inflation has also come down faster than expected, with it falling to 6.7 per cent in August. With wage growth remaining strong, this will improve consumer spending power.