Mixed signals for UK consumer spending

Retailers’ tills are still failing to ring after a key survey yesterday showed high street sales growth slowing for the third month in a row.

However, the latest distributive trades survey from the CBI suggests that retailers expect their overall business situation to improve slightly over the next three months for the first time since November 2016.

Grocers reported strong sales volumes growth in the year to February, while “robust” growth was also reported in internet and mail order goods, hardware and DIY.

But this was partly offset by falling sales in department stores, clothing, furniture and carpets, and the footwear and leather category.

Anna Leach, head of economic intelligence at the CBI, said: “While trading conditions remain tough, it’s encouraging to see retailers’ investment intentions improving to their highest since August 2015, in addition to signs of renewed business optimism for the first time in more than a year.”

Last week, official figures showed that UK retail sales rose by just 0.1 per cent monthon-month in January, with economists pencilling in a more optimistic outcome of 0.5 per cent.

Howard Archer, chief economic advisor to the EY Item Club think-tank, said: “Consumer confidence is fragile as it is pressurised by economic, political and Brexit concerns and uncertainties as well as squeezed purchasing power, and this is fuelling caution for people making major purchases.” 0 Howard Archer: ‘fragile’ consumer confidence