Retail sales fall amidst Brexit uncertainty and low consumer confidence, says CBI
March 27, 2019
Retail sales volumes fell in the year to March, compounding a subdued start to 2019, according to the latest monthly CBI Distributive Trades Survey.
The survey of 105 firms, of which 50 were retailers, showed retail sales volumes fell sharply (-18 per cent), the fastest contraction in 17 months and marking a four-month run in which sales have not grown.
This disappointed retailers’ expectations for strong growth in March, but sales volumes are expected to rise again in April (+15 per cent).
Orders placed on suppliers also fell in the year to March (-13 per cent from +7 per cent in February), but are expected to return to modest growth in April (+6 per cent).
It is possible that year-on-year sales growth in March has been distorted by the later timing of Easter this year. Indeed, sales volumes actually rose further above average for the time of year (+13 per cent from +4 per cent in February) and are expected to remain above seasonal norms in April (+12 per cent).
Year-on-year growth in internet sales slowed in March (+21 per cent) to the lowest rate in 12 months. Growth is expected to pick up in the year to April (+31 per cent).
Wholesalers reported the slowest pace of annual growth in sales volumes in nine months (+13 per cent) and are expecting a further slowing next month (+6 per cent).
Motor traders also reported their fastest fall in sales volumes for 11 months (-16 per cent).
Sales for the time of year were seen as the poorest since November 2014 (-11 per cent), and are expected to fall further below seasonal norms in April (-36 per cent).
Across the broader economy, underlying conditions remain subdued, particularly as Brexit uncertainty and slower global growth continues to hold back momentum.
For more detail on our view of the outlook, see the CBI’s December Economic Forecast.
Anna Leach, CBI head of economic intelligence, said:
“Even accounting for Easter timing, the High Street’s poor run continues. While real wage growth is picking up, consumer confidence has been hit by escalating uncertainty over Brexit and concern over the economy’s future.
“The pain currently being felt on the High Street is yet another reason why it is so vitally important politicians agree a deal in Parliament that is acceptable to the EU and protects our economy. No-deal must be averted at all costs.”