UK retail sales grew unexpectedly in August, driven by a strong performance from clothing stores, a new report has revealed.
In the latest CBI Quarterly Distributive Trades Survey, 36% of retailers said sales volumes increased in the year to August, while 15% said they fell, giving a balance of +24%, beating expectations of +13%.
Retail sales growth was driven in particular by clothing stores, which continued to report strong sales growth, the CBI said.
Meanwhile, internet sales growth accelerated in August, but remained below its long-term average, with a slightly stronger performance expected next month.
Retailers expect a faster rate of growth in sales volumes in the year to September with the corresponding balance at +35%.
Their optimism about business situation over the next three months increased in August and an improvement in investment intentions for the year ahead climbed to +17% from -10% in the previous quarter.
Rain Newton-Smith, CBI Director of Economics, said: “Retail growth is continuing at a steady pace and it’s really encouraging to see firms’ investment intentions picking up alongside more jobs being created in the sector.
“Household spending seems to have remained firm going into the second half of this year, so the outlook for the retail sector looks upbeat.
“However, the renewed fall in average selling prices illustrates the intense challenges facing some retailers – particularly grocers – where strong price competition to capture consumer value is still prevalent.”