High street hit by surprise drop in sales
By myfinances.co.uk staff
High street sales were much weaker than expected during the first two weeks of May, according to the Confederation of British Industry (CBI).
Its latest survey of retailers found that while 30 per cent saw trade increase compared with the corresponding period of last year, 48 per cent said it had declined.
The resulting balance of minus 18 per cent was well below respondents' forecast of plus 17 per cent and was the lowest figure recorded by the CBI since March 2009.
Retailers were gloomy in their outlook for next month, with a balance of minus 15 per cent predicting another year-on-year decline in business.
Elsewhere, inflation picked up, with 54 per cent of respondents saying prices had risen compared with May 2009, while only five per cent reported a drop.
CBI chief economist adviser Ian McCafferty said: "It appears that shoppers are feeling the pinch again and are being cautious with their purchases, given the squeeze to real incomes from higher prices and only a modest rise in average pay."
According to the Office for National Statistics, the annual rate of consumer prices index inflation hit 3.7 per cent last month, 1.7 per cent higher than its official target.
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