Contraction in UK retail sales volumes unexpectedly eases in November - CBI

The Confederation of British Industry (CBI) reported on Monday its latest survey of retailers showed retail sales volume balance rose to -3 in November from -10 in October. That marked the seventh consecutive month of decline in retail sales volume but represented the highest balance since April.

Economist had forecast the reading to stay at -10.

The report also revealed that orders placed on suppliers (-9) also fell for the seventh straight month in November. Meanwhile, retailers expect a recovery in orders growth next month (+12). Stock levels in relation to expected sales eased from the record high last month (to +30 from +52%) and are expected to return to broadly average in December (+18). Business conditions are forecast to remain stable over the quarter ahead (+4), following a steep weakening in expectations last quarter (-25). However, investment intentions for the year ahead declined for the sixth consecutive quarter (-38) and at a faster pace than last quarter (-19)

Anna Leach, CBI Deputy Chief Economist noted: “Retailers are entering the festive season with a bit of hope that sales will head up, with the strongest expectations in half a year. Actual sales have also stabilized and have nudged above average for the time of year. And employment has stopped falling after three years of decline. But Brexit uncertainty continues to weigh on investment plans for the year ahead which remain weak. As the election period gets into full swing, retailers will welcome the prominence being given to fixing the broken business rates system. But it will be up to the next Government to turn warm words into action.”