According to the latest monthly CBI Distributive Trades Survey, retail sales grew for the first time since November 2018 in the year to April.
“It’s encouraging to see retailers with more of a spring in their step than in recent months,” commented Rain Newton-Smith, the CBI’s chief economist. “The recent pick up in real wages is a welcome support to the sector, making the £pound in people’s pockets stretch that bit further. However, this month’s sales growth will have been distorted by the later timing of Easter, and falling sales in clothing and department stores underline how challenging underlying conditions remain.”
She adds: “The Brexit extension means an economic crisis has been avoided for now. However, uncertainty continues to drag on consumer confidence, and many retailers report an impact on their sales. Politicians now owe it to the country – its businesses and people – to come together in a total spirit of compromise, setting aside all party political lines, and agree a way forward to avoid a no deal Brexit.”
The survey of 110 firms, of which 55 were retailers, showed that sales volumes rose for the first time in five months, likely to have been supported by the later timing of Easter this year, with sales remaining above average for the time of year. Orders placed on suppliers also grew and are expected to pick up further in the month ahead, with sales volumes also set to see somewhat faster growth. However, while growth in online sales improved slightly, it remained far below its long-run average.
The CBI said that stockpiling is likely to have supported economic growth in early 2019 as a whole. However, as highlighted by business surveys, underlying conditions remain more subdued, as Brexit uncertainty and slower global growth begins to bite.
Top: A late Easter helped to drive retail sales.
