Growth in the volume of sales on the UK high street is currently flat, according to new data released by the Confederation of Business Industry (CBI) this morning.
Looking at trading between May 27th 2011 and June 15th, the CBI reports that only 33 per cent of retailers saw sales volumes increase compared to a year ago whilst 34 per cent claimed they had declined.
A resulting balance of -2 per cent is the worst recorded in 12 months and compares badly with the +18 per cent recorded last month.
Judith McKenna, Chair of the CBI Distibutive Trade Panel and Asda Chief Financial Officer, said: “After a year of growth, high street sales volumes fizzled out in June. Consumers are really feeling the pinch as disposable incomes continue to be squeezed by rising prices and weak earnings growth.
“Household budgets are likely to remain tight over the coming months, with inflation edging higher as increases in domestic gas and electricity prices take effect.”
When asked how sales were during the period, only 17 per cent of retailers described them as good whilst 36 per cent said they were poor.
Grocery reported the slowest pace of growth in sales for two years, up just 26 per cent, whilst clothing trade dropped down two per cent year-on-year and household goods saw the steepest decline of 85 per cent.
Vicky Redwood, Senior UK Economist for Capital Economics, commented: “June’s UK CBI distributive trades survey provides further evidence that retail sales growth has fallen back after its temporary improvement during the spring.
“Admittedly, the survey only covers from 27th May to 15th June. But there is no obvious reason for sales to have picked up after this. And with households’ real incomes still falling, we think that further weakness in consumer spending lies ahead.”