High street sales fell more sharply than expected in the first half of November, the Confederation of British Industry’s (CBI’s) last survey has shown.
Compared with the same period last year, 62% of firms said sales are lower, while 16% said they were higher.
The balance of -46 is lower than the -27 balance seen in October and worse than retailers had predicted (-25), while a fall in volumes of -40% is expected in December.
Earlier today, the Gfk NOP Consumer Confidence Index found consumers are still largely pessimistic about the state of the economy.
CBI Distributive Trades Panel chairman and retail director at Asda Andy Clarke said retailers will have to work harder than ever before to see success this year.
He said: “Lower petrol prices and recent cuts in interest rates should help put a little more into people’s pockets, as will the VAT cut, but only if retailers pass it on before Christmas.”
In the three-month moving average of sales volumes, there was a balance of -33.
Clarke said: “The added pressure of changing millions of prices, to reflect the cut in VAT, will be an unwelcome and costly burden.”
Retailers gave a mixed reaton to the news Chancellor Alistair Darling is cutting VAT to 15%.
