Retailers across the UK have reported another sharp drop in sales this month, as fragile consumer confidence continues to weigh on spending, according to the Confederation of British Industry (CBI).
The business group’s latest Distributive Trades Survey, released just a day ahead of Rachel Reeves’s spring statement, shows retail sales volumes fell year-on-year in March — marking the sixth consecutive monthly decline. It represents the steepest fall in retail sales in eight months, highlighting ongoing pressures facing both consumers and businesses.
The data adds to findings from a separate survey by KPMG, which also revealed households are cutting back on everyday purchases in response to rising costs and economic uncertainty.
Martin Sartorius, principal economist at the CBI, warned that the outlook remains bleak: “Annual retail sales volumes fell markedly in March and are expected to continue declining next month. Firms across the retail and wholesale sectors reported that global trade tensions and the Autumn Budget are weighing on consumer and business confidence, which is leading to reduced demand.”
He added that Reeves’s spring statement is likely to shine a light on the UK’s persistent structural challenges and urged the government to deliver policies that restore business confidence and drive investment.
“Reforming business rates, supporting the British Business Bank’s Growth Guarantee Scheme, and properly resourcing the Growth and Skills Levy could support businesses’ investment plans and drive the government’s growth ambitions,” Sartorius said.
The CBI’s survey is based on the difference between the number of retailers reporting rising and falling sales. It found that sales volumes dropped at an accelerated rate in the year to March, and while the pace of decline is expected to slow next month, retailers are still anticipating a subdued April.
Sales for the time of year were once again judged to be below seasonal norms, continuing a trend seen in February. With global economic uncertainty, domestic fiscal tightening and cost pressures continuing to bite, the retail sector appears to be bracing for a difficult spring.
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Retail sales fall sharply in March as weak confidence hits consumer spending