UK June Retail Sales Jump, Stocks Dwindle: CBI
British retailers reported a jump in sales in June as the country's fast vaccination programme encouraged shoppers to go out and spend, the Confederation of British Industry said on Friday.
The CBI's measure of the volume of sales rose to +25 from May's +18, the highest since August 2018, while sales were reported as above seasonal norms - which excludes the effect of last year's lockdown - were the highest in over four years.
In May, monthly balance for whether sales were above or below normal for the time of year dropped to -3 from +16 in April, indicating roughly normal volumes.
'Stronger Consumer Confidence'
"This was the latest sign that the success of the vaccination programme is feeding through to stronger consumer confidence," CBI economist Ben Jones said.
Online sales slowed sharply in the year to June, registering its weakest pace since April 2020 and well below the long-run average.
Wholesalers saw the most positive sales performance in relation to seasonal norms since November 2018, up 34% from +18%.
The CBI survey also showed stock levels in relation to expected sales sank to their lowest since records began in August 1983 and no improvement was expected next month.
The Bank of England is keeping a close eye on whether bottlenecks in supply caused by the pandemic lead to longer-term inflation pressures.
Jones added that the sector remains a long way from a full recovery, and added, "The return of demand is patchy, with inner-city footfall still well down. The outlook is also clouded somewhat by supply pressures, with stocks seen as too low compared with expected sales, as logistical and capacity challenges continue to hamper global activity."
"Even as consumer demand returns, the legacy of lockdowns on retailers’ balance sheets remains. Many will welcome the rent moratorium extension, but more support is needed, starting with holding off on tapering existing business rate reliefs."