UK retail sales volumes in early June were virtually unchanged from the same period of 2012 – a survey has revealed – disappointing industry players' expectations of a solid year-on-year rise.
However, the June showing was better than a month earlier, when retailers reported a significant year-on-year fall in sales volumes.
The survey, conducted by the Confederation of British Industry between May 29 and June 13 and published yesterday, served as a reminder of continuing pressures on UK consumers in spite of a recent run of slightly more positive economic data.
Subtracting the percentage of retailers reporting that sales volumes were lower than a year earlier from that declaring they were higher, a net 1% reported a rise.
This lacklustre reading contrasted with a net 10% of retailers, which had a month earlier predicted a year-on-year rise in sales volumes in June.
However, the latest balance is an improvement on the net 11% of retailers which had in the CBI's May distributive trades survey reported that sales volumes were lower than a year earlier.
Howard Archer, chief UK economist at consultancy IHS Global Insight, said: "The recent improvement in a wide range of indicators has raised hopes that the UK economy may finally be moving to a firmer footing.
"However, the relatively lacklustre June CBI survey does highlight the fact that there are still significant uncertainties about the prospects for consumer spending going forward.
"While record high employment and improving confidence are encouraging for consumer spending prospects, purchasing power is constrained by earnings growth currently running well below the inflation rate."
Michael Pearce, assistant economist at consultancy Capital Economics, said: "June's improvement in the CBI distributive trades survey adds to the run of more positive evidence on the retail sector. But the improvement was weaker than expected and, while retailers remain optimistic, we think the slow improvement in economic conditions will mean that their expectations are disappointed."
The CBI survey pointed to strong year-on-year growth in sales volumes in early June for department stores, and a solid rise for grocers.
Retailers of footwear and leather goods did well, but there was a big year-on-year fall in sales volumes in the durable household goods sector. Non-store sales were up sharply year-on-year.
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