In the UK, the decline in high street sales accelerated in August, according to the CBI Distributive Trades survey. More retailers saw the volume of sales falling in August (-14% from -5%), and also orders placed weakened in the month (-22% from -13%). Sales for time of the year improved marginally from an awful balance of -33% to -28%. Price inflation remains high and above average at +55%, but fell to the lowest level since November 2010.
Looking ahead, retailers expect the volume of sales to fall again in September, but at a slightly slower pace. The CBI added that August was a tough month on the high street as sales volumes fell at a pace not seen in over a year. Also in the coming months, retail activity will probably remain weak as consumers feel their incomes squeezed by a combination of high inflation and weak wage growth, while also the fear of a new recession and tensions in financial markets might have scared consumers.