MNI: July UK Retail Sales Growth Steady, But Orders Slip: CBI

--UK July Retail Sales Volumes Balance +20 Vs +32 In June

By Jai Lakhani

     LONDON (MNI) - UK retailers saw a weather-induced boost in retail sales

volume growth in July, although at a slower pace than in the previous month, but

supplier orders were down sharply on the month, a CBI survey showed.

     The reported sales volume balance rose to +20 in July, down 12 points from

June but 2 points above the expected level. The figure is also in line with the

long-run trend. 

     July's result meant that the headline balance has now put together a string

of four consecutive monthly increases after falling into negative territory in

March. However, the rosy picture does not appear to have sustained expected

sales volumes, standing at 0 for August.

     Dissecting the month's rise in activity, growth was fairly broad-based

across retail sub-sectors, with the pick-up in June driven particularly by a

rise in non-store sales, footwear & leather and department stores. 

     Grocers and hardware & DIY stores also fared well, reporting robust sales.

Meanwhile, carpet and furniture stores and clothing retailers continued June's

drop in sales volumes with further falls in July of 43 and 15 units

respectively. 

     "While the heatwave has boosted retail sales in recent months, we may be

seeing some early signs of a cooling off, with orders falling in the year to

July and retailers expecting no growth in sales next month," said Alpesh Paleja,

CBI Principal Economist

     Orders placed on suppliers fell in July, down 28 points to -8 -- the lowest

outturn since last October. 

     "Indeed, the long-term challenges facing the retail sector are significant.

Continually subdued real wage growth means that households are still felling the

pinch, and retailers are still grappling with deeper structural issues, such as

digital disruption," Paleja added.

--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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