UK retail sales volumes slumped to their lowest level in over a year in May as consumers' finances continue to be squeezed by rising prices and slowing earnings growth, while retailers' investment plans also declined, figures showed Wednesday.
The Confederation of British Industry's retail sales survey fell to a balance of -11 in May. That was the steepest drop since January 2012 when the balance was -22 and compares with -1 in April.
The balance is calculated by subtracting the number of retailers reporting sales rose from the number reporting they fell compared with a year earlier.
"Retail sales growth has weakened since the start of the year as households continue to feel the pinch, with wages failing to keep pace with the cost of living," said Barry Williams, Asda chief merchandising officer for food and chairman of the CBI distributive trades survey panel.
The survey also showed that UK retailers are more optimistic about sales in June with a balance of +10 expecting sales to rise, however the longer term view is less sanguine.
In a round of additional questions that are only asked every three months, investment intentions sank to a balance of -23 in May from -7 in February, and the business outlook was weaker in May at +10 than in February when the balance was +12.
