Responding to the CBI's quarterly Distributive Trades Survey, one in five retailers said their overall business outlook is likely to deteriorate over the next quarter. This is the first time in seven years that more retailers are pessimistic about the future than hopeful. Only about 10 per cent of retailers were optimistic, with the majority neutral.
Sales volumes this month, compared with a year ago, were down for 45 per cent of retailers, while only 27 per cent reported an increase in sales.
The underlying sales trend, measured by a three-month moving average, is the weakest in the 22-year history of the CBI survey.
'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 John Longworth, executive director of Asda and chairman of the Distributive Trades Survey panel.
The survey covers 20,000 outlets of companies responsible for 40 per cent of retail employment.
The gloomy mood was further underpinned by the summer's unexpected cricket fever. About 7.7 million viewers tuned in to watch the Ashes last weekend, traditionally a strong sales period in the run up to the new school term.
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