British retail sales growth surged in May as 60% of businesses surveyed in CBI’s latest Distributive Trades Survey said volumes were up compared to a year ago, with only 9% reporting dip is volumes, giving a balance of 51%.
That’s a significant jump from 12% in April and retailers expect volumes to rise even more next month, the survey indicates.
The measure of expected sales for June showed that 63% of retailers expect volumes to increase, while just 4% said they would decline. The balance of 59% is the highest for almost three decades.
Most sub-sectors reported growth in sales volumes including grocers (+50%), non-specialised stores (+98%) and recreational goods (+100%), while hardware & DIY witnessed a fall in sales volumes on a year ago (-67%) – the lowest since April 2013.
“Retailers will be encouraged to see growth in sales and orders on the high street bounding ahead,” says CBI director of economics Rain Newton-Smith. “Low inflation, which we expect to remain below 1% for the rest of the year, has given household incomes a much-needed boost and greater spending power. Overall the outlook is bright for firms on the high street, but challenges still remain, especially for food retailers, who are still feeling the heat of stiff price competition from new entrants to the sector. And investment plans have also taken a hit.”