Grocery sales are up year-on-year, but retailers fear worsening conditions as poor overall figures continue.

Sales of groceries and specialist foods have risen on last year with positive balances of 20 per cent and 40 per cent respectively, says the CBI’s Quarterly Distributive Trades Survey (DTS). The overall business outlook is still bleak though, with 20 per cent of retailers expecting sales to deteriorate over the next quarter.

“Conditions in August continued to be very tough for retailers and many fear the outlook is going to get worse before it improves, despite the recent interest rate cut,” said chairman of the CBI’s DTS panel and Asda executive director John Longworth.

“Some held earlier and longer summer sales despite margins already being very tight, but there has been little sign in this survey of a response from consumers,” he added.

However, reports of a long-term growth in wholesale could buck the trend. Overall business expectations are optimistic, showing a positive balance of 25 per cent, for the second successive quarter.

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