Retail sales growth continues in June

According to the latest distributive trades survey (DTS) from the Confederation of British Industry (CBI), a positive balance of 9% of retailers say they have seen an increase in sales this month, unchanged from last month’s survey, which saw the fastest growth in shop sales since December 2004.

The figure also represents the third successive month of growth, driven largely by purchases related to the World Cup, but the lack of change from May’s report has many analysts concerned that the current expansion will not outlast the football competition.

“It is certainly encouraging that retailers’ sales have grown overall for a third month running, and this bodes well for the next couple of months,” said John Longworth, chairman of the CBI’s DTS Panel and executive director of Asda.

“But not all sectors have benefited, and the recent pick-up may prove to be short-lived once the England team returns home. In the longer-term, the consumer is also likely to stay under some pressure.

“Add to that the instability in the world’s financial markets and speculation about interest rates and consumers may yet become more cautious in their spending.”

Meanwhile, the survey also found that the underlying trend in sales growth for the year, which is measured by the three-month moving average, stands at a positive 7%, the most positive it has been since February last year.

Supplier orders also by a balance of 7% in June, while most retail sectors benefited from the growth. Only in footwear, specialist foods and booksellers and stationers did sales fall on the previous year.