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Retail sales fall for longest period since 2011

Published:  26 July, 2019

Retail sales fell for the third consecutive month in the year to July, marking the longest period of decline since 2011, according to the latest CBI monthly Distributive Trades Survey.

The survey also showed that sales volumes fell in the year to July, albeit to a lesser extent than in June.

Orders placed on suppliers also declined for the third consecutive month, but at a slower pace than the previous month, with both sales and orders anticipated to be "broadly flat next month", the report stated.

Grocers were the largest positive contributor to headline sales growth this month, reversing fortunes after a large fall last month. This however was more than offset by declines in other categories, particularly department stores and clothing.

Wholesalers reported no growth in sales on a year ago, but a "small pick-up" is expected in the month ahead, said the CBI.

While last year’s summer strength in retail sales was driving some of the comparative weakness this year, it was still “hugely concerning that sales have fallen for the longest period in almost eight years”, said CBI chief economist Rain Newton-Smith.

“Despite the recent pick-up we’ve seen in households’ real earnings, the sun is clearly not shining on the British High Street. The UK economy has reached a fork in the road. The new Prime Minister must now do everything in his power to achieve a good Brexit deal, thus protecting jobs and our economy.”

Growth in online sales recovered after flattening out in the year to June. However, growth remains below the long-run average, and is expected to edge lower in the year to August, according to the survey, which was conducted between 27 June and 16 July and included a total of 93 companies, of which 46 were retailers, 40 were wholesalers and seven were motor traders.