Retail sales volumes are down about 5% for the year through June, according to survey data from the latest Confederation of British Industry (CBI) Distributive Trades Survey released Thursday (June 23) – and it looks like more bad news is coming for July.
June marks the third straight month during which volumes have stalled, the CBI said in a press release, and retailers expect the results a month from now to show flat sales volumes through July. For the month, sales were down 19% after being flat in May, and they are expected to be well below normal in July, with a projection for a 25% sales volume drop from typical levels in the survey results.
Retailers had stock levels that were “too high” in June at 12%, up slightly from 11% in May but below the long-term average of 17%, according to the release. There’s no end in sight to the excess stock levels, with projections for July in the 12% range.
Year-over-year retailers’ orders with their suppliers fell 8% in June, compared to a 2% increase last year, the release stated. This marks the fourth straight month of flat or falling order levels, and the expectation is July will make it five consecutive months with projections for a 10% dip. Wholesale growth went from 30% last June to 4% this June.
“Retail volumes are struggling as high inflation eats away at consumers’ budgets,” said CBI Lead Economist Ben Jones in the release. “The squeeze on household incomes appears to have offset any boost to activity from the extended Platinum Jubilee bank holiday earlier this month.
“There are also clearer signs that a downturn in consumer spending is beginning to ripple out across the wider distribution sector, with wholesalers seeing a 14-month period of robust sales growth come to a grinding halt this month,” he added in the release.
Jones called on the government to help save the British economy.
“Creating a permanent investment incentive and tackling skills shortages by introducing immediate flexibility to the apprenticeship levy would be strong first steps for boosting confidence,” he said in the release.
In the US, meanwhile, there’s a high likelihood that the “unacceptably high” prices of recent months won’t recede in 2022, according to Treasury Secretary Janet Yellen.
Read more: Yellen Expects Inflation Through 2022, Economic Slowdown