UK retailers have seen the longest period of falling sales in almost eight years, fueling growing concern for the economy ahead of Brexit.
The Confederation of British Industry said retail sales across the country fell for a third consecutive month in July, marking the longest period of declining sales since 2011.
Amid heightened political uncertainty within 100 days of Brexit, sales fell the most for department stores, clothing stores and retailers selling other consumer goods such as jewelry and flowers.
The survey of 93 large retail companies and wholesalers found that sales volumes fell in the year through July, although to a lesser extent than in June. Retailers placed fewer orders with their suppliers for the third month in a row, and a further decline is expected in August.
Rain Newton-Smith, chief economist at the CBI, said the figures were extremely concerning. âThe sun is clearly not shining on Britain’s Main Street,â she said. âThe UK economy has reached a crossroads. The new Prime Minister must now do everything in his power to reach a good Brexit deal, thereby protecting jobs and our economy. “
The retail sector’s warning shot comes as a no-deal Brexit becomes an increasingly likely prospect following Boris Johnson’s rise to prime minister. Economists warn that household budgets could come under intense pressure in such a scenario, if the cost of living and unemployment rise.
The monthly retail sales index of the business pressure group reached -16% in July from -42% in June. Despite a slight improvement over the month, the balance remains in negative territory, showing that more retailers reported a drop in sales than an increase. City economists were expecting a reading of -10%.
Internet sales growth accelerated from the previous month, although the CBI warned that the volume of goods purchased online remained below the long-term trend. He said sales growth is also expected to slow further during the year through August.
Economists have warned that the CBI’s retail sales monitor is often too pessimistic. The most recent official figures for Main Street show sales have been resilient in recent months.
Suggesting that consumers continue to endure increased levels of Brexit-related political unrest, the Office for National Statistics reported the volume of goods sold in May. increased by 1% over the month. Sales are up 3.8% for the year, beating forecasts from City economists.