UK retailers witnessed their biggest fall in sales in four years after last month’s vote to leave the European Union, according to the Confederation of British Industry (CBI).
In a survey of 66 retailers, 24% said sales volumes were up in July compared with a year earlier, while 38% said they were down, giving a balance of 14%.
This followed a modest growth of 4% in June.
The CBI said that a snapshot of retail activity taken in the period immediately after Britain voted to exit the EU on June 23 showed that consumers kept tight control of their shopping budgets.
“While conditions in the retail sector have weakened, we should be careful about reading too much too soon, as consumers were likely to err on the side of caution in the immediate period following a vote to leave the EU,” said CBI chief economist Rain Newton-Smith.
“Current low levels of inflation and high overall employment should support consumer spending in the near term, although the impact of lower sterling is likely to feed through to higher inflation over time,” he added.
“What businesses and consumers need now is calm and decisive leadership, a clear timetable and a plan for negotiating the UK’s future outside the EU to restore confidence.”