British retailers experienced their third consecutive month of declining sales in August, and they anticipate a further decrease in September, leading them to scale back their hiring and investment strategies, according to the Confederation of British Industry (CBI) on Tuesday.
The CBI reported that its monthly retail sales balance reached -27 this month, an improvement from July's -43 but still the second-lowest figure since April. Retailers foresee another sluggish month in September, with a sales expectations index at -17.
"Retail sales volumes continued to underperform in the year leading up to August, with declines also observed in the wholesale and motor trade sectors," stated Martin Sartorius, principal economist at CBI. "Retailers have become more cautious about their investment and hiring plans, which appears to be a response to ongoing concerns about weak demand," he added.
The retail sector has faced significant challenges due to reduced household spending power and adverse weather conditions in recent months. A quarterly survey revealed that investment intentions fell to -35 in August from -25 in May, and the expected employment plans index dropped to -28 from -18. The measure of retailers' anticipated selling prices also softened to +15 from +30 in May.
Additional data released on Tuesday indicated that shop prices declined year-over-year in August for the first time since October 2021. Earlier this month, official retail sales figures showed a slight increase in British retail sales in July, partly driven by the men's Euros soccer championship and warmer weather. The CBI survey collected responses from 50 retail chains between July 29 and August 14.
