Retail sales dip in October
Tuesday, 31 Oct 2006 11:28
Retail sales slipped in October
Six months of positive growth for Britain's recovering retail sector have been ended by a dip in sales during October, according to the Confederation of British Industry (CBI).
Publishing its monthly distributive trades survey today, the CBI found that 42 per cent of retailers said sales had slipped in the last 12 months.
This compared to 38 per cent saying sales had improved in that period, meaning that the overall sales balance was a negative four per cent – the first negative balance since March this year.
"October's dip in sales ended six months of growth for retailers. This is doubly disappointing as it confounded more positive expectations," John Longworth, chairman of the CBI’s distributive trades survey panel, commented.
"It remains to be seen whether this is a return to the tough conditions seen during 2005 and early 2006, or simply a blip in an otherwise upward trend."
According to today's survey, retailers believe that the latter is the case. A positive balance of 11 per cent predicted positive growth in November, while the balance of those believing sales were normal for the time of year improved from minus six per cent in September to minus three per cent this month.
"We will have to wait for November's figures to see if the warmer, wetter weather we're experiencing puts the Christmas build-up on hold and if the widely anticipated interest rate rise materialises and dampens festivities and retailers' sales," Mr Langworth added.
The Bank of England is expected to raise interest rates from their current level of 4.75 per cent to five per cent when the monetary policy committee makes its November decision a week on Thursday.