High-street sales pick up

UK high-street sales grew modestly in the year to October and at the most positive rate in almost two years, according to the CBI.

Its latest monthly Distributive Trades Survey also shows that sales in sectors related to the housing market improved and that the high street anticipates stronger sales growth in November.

Asked about sales in the year to October, 41 per cent of respondents said that volumes had risen, while 33 per cent said they were down.

Looking to November, a balance of 19 per cent expects sales volumes to improve, which is the most optimistic since July 2007, up 19 per cent.

Sales were reported to be poor for the time of year by a balance of five per cent of retailers, which was a marked improvement on September. A net seven per cent believes sales will remain below seasonal norms in November.

The three-month moving average of sales volumes, which smoothes out monthly peaks and troughs, stabilised (a balance of down two per cent), and is expected to grow slightly in November.

A balance of three per cent of firms said the volume of orders placed on suppliers fell, but the improved retail demand should feed through to suppliers in November, when firms predict stronger orders.

Andy Clarke, chairman of the CBI Distributive Trades Panel and chief operating officer of Asda, said: "The latest official data shows the economy is still in recession. However, the retail sector seems to be finding its feet again after a challenging year, and the outlook for November is encouraging. But overall the economy remains troubled and some retailers will find the recovery slow and painful.

"It is heartening to see signs of life in sectors related to the housing market, particularly those retailers selling white goods and furniture, who have had a torrid two years. And we think some consumers will bring forward big ticket purchases to beat the VAT rise in January."

Sales volumes in the wholesale sector were broadly flat for a second month which beat expectations of a heavy fall of around 38 per cent. Flat sales are expected in November.