Retail sales volumes fell significantly in the year to July, showing that trading conditions in the sector remain weak, according to the Confederation of British Industry (CBI).
The CBI's latest distributive trades survey found that sales volumes fell by a weighted balance of -25% in the year to July, compared to -9% a month earlier, marking the steepest decline in retail sales since April 2022.
Meanwhile, orders placed upon suppliers in the year to July (-39%) fell at the fastest pace since January 2021.
The CBI expects sales to decline even more rapidly in August (-32%), with supplier orders also set to fall at a faster rate this month (-45%).
Commenting on the survey's findings, CBI principal economist, Martin Sartorius, said:
"Firms remain cautious about the retail sector's near-term outlook as they pare back on orders and brace themselves for another sales contraction in the year to August.
"Cost pressures, a tight labour market, and rising interest rates, alongside uncertain demand conditions, make the current environment difficult to navigate for retailers. Now more than ever, business rates reform would go a long way to alleviate cost pressures in the retail sector, which burden them disproportionately compared to other businesses."
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