British retail sales fell in July at the fastest rate since April 2022 and stores are bracing for worse times ahead, with many chains cutting orders placed with suppliers, an industry survey showed.
The Confederation of British Industry's monthly balance of retail sales, which compares volumes with a year ago, fell to -25 in July from -9 in June. Expectations for the month ahead fell to -32 from zero, the weakest reading since March 2021.
'Another Sales Contraction'
"Firms remain cautious about the retail sector's near-term outlook as they pare back on orders and brace themselves for another sales contraction in the year to August," said CBI economist Martin Sartorius.
The survey's gauge of orders placed with suppliers fell to its lowest level since January 2021, when Britain had re-entered a COVID-19 lockdown.
"Cost pressures, a tight labour market, and rising interest rates, alongside uncertain demand conditions, make the current environment difficult to navigate for retailers," Sartorius said.
Rising Cost Of Living
In June, British retail sales fell again as household finances were squeezed by the rising cost of living but stores expected sales volumes to stabilise next month.
At the time, the CBI said retail sales volumes were average for the time of year at +1% in June compared with -18% in May, and were expected to remain broadly in line with seasonal norms in July at -2%.
Elsewhere, British grocery inflation eased for a fourth month in a row in July, seeing its steepest decline since it peaked in March this year, providing a bit of relief for cash-strapped consumers suffering from high prices.
