High street sales ease in April, says CBI

The CBI posted a “small” decline in retail sales, balancing -6% in the month against a forecastof -4%

Volume of orders declined to a balance of -7%.

But retailers believe retail sales will turn around in May, and forecast a rise to +19% - the highest prediction since February 2011 (+25%).

Chair of the CBI Distributive Trades Panel and Asda chief operating officer Judith McKenna said:“The situation on our high streets remains fragile. Consumers are still holding off from buying bigger ticket items, and opting to spend on smaller ‘treat’ purchases that give them a lift without breaking the budget.

“If as expected, inflation falls further later this year, we may see some growth in retail sales, but as long as high unemployment and sluggish wage growth dampen confidence, spending will remain tight.”

Furniture and carpet retailers posted the third consecutive monthly increase in volumes to +72%. Clothing and footwear grew “solidly”.

But food retailers witnessed their first sales fall since November, recording a plunge to -19% for April.

The news comes amidst news the UK economy has slipped back into recession, as the economy contracted across the last two quarters.

Barclays head of retail Richard Lowe said: “Retailers will be concerned about the psychological damage the contraction in economic growth will have on consumer confidence, despite recent data showing some signs of stability.”