Retail sales growth slowed in the first two weeks of December according to the CBI.
According to its Distributive Trades Survey, 36% of retailers reported an increase in sales volumes compared to a year ago, while 17% recorded a decrease giving a positive balance of 19%.
This is broadly in line with the long-run average of 21%, however behind the stronger, above 30%, increases experienced over the two previous months as well as retailers’ expected 25% growth.
As a result, retailers considered sales volumes to be below average for the time of year, with a negative balance of 18%, disappointing expectations that they would be in line with seasonal norms.
Sales growth is expected to continue losing steam next month, with retailers forecasting a slower rise once again in the year to January, with a positive balance of 18% expecting growth.
Judith McKenna, chair of the CBI Distributive Trades panel and Asda chief operating officer, said: “Ongoing economic fragility is maintaining the squeeze on household incomes, and it’s notable that sales are below par for the festive season.
“So while families are making their budget stretch as far as possible for the Christmas season, the Christmas spending spirit can only go so far. In reality, sales growth has actually slowed since the autumn and retailers are expecting a further slowdown in the New Year.”
The grocers recorded their eighth consecutive month of rising year-on-year sales, with a positive balance of 42%, while the clothing sector also experienced sales growth, with a positive balance of 39%.
Sales were less buoyant for shops selling big ticket items for the home, which recorded a negative balance of 58%.
CBI head of economic analysis Anna Leach said: “This month’s survey hasn’t quite provided the Christmas cheer that retailers anticipated, with sales growth falling short of expectations.”