Retailers see fastest drop in June sales since 2009 financial crisis

UK retail sales volumes in June fell at the fastest rate since March 2009, according to a new report by the CBI (Confederation of British Industry).

The CBI’s monthly retail sales balance fell to -42 from -27 in May. Grocers were the largest contributors to the fall in sales volumes, with the hardware & DIY and footwear & leather sub-sectors also reporting declines.

Across the retail sector, internet sales stalled in the year to June, marking the weakest growth since the question was first introduced to the survey in 2009. The CBI said internet sales growth is expected to pick up next month, but at a pace well below the long-run average.

Alpesh Paleja, CBI principal economist, said in a statement: “This month’s drop in sales should be taken with a pinch of salt, given the backdrop of last June’s heatwave and the start of the World Cup. But even accounting for both factors, underlying conditions on the High Street remain challenging. Retailers are having to continually compete for the attention of value-conscious shoppers, in the age of digital disruption.

“The new Prime Minister must help support retailers by reducing the high cumulative burden of costs they face. This should start by urgently reviewing the dire business rates system, which is unfairly impacting UK high streets and deterring much needed investment.”