GB: CBI Distributive Trades

Wed Jun 27 05:00:00 CDT 2018

Consensus Actual Previous
Level 10 32 11

The CBI's latest Distributive Trades Survey was decidedly upbeat with the balance of respondents reporting an increase in annual sales growth jumping some 21 percentage points to 32 percent, its highest level since last September. This was much stronger than market expectations and also well above the 18 percent forecast by the CBI in May.

Today's survey shows broad-based strength although it is worth noting that the headline reading was probably biased up by seasonably warm weather. Sales for the time year weighed in at a healthy 25 percent and, at 20 percent, orders placed with suppliers saw their highest mark since November 2017. However, the CBI expects a decline in the sales balance to 18 percent in July.

In fact, the CBI retained a generally cautious view of the consumer, in particular warning about the effects of the continued sluggish growth of real wages.

The Confederation of British Industry (CBI) produces a monthly survey (and a more detailed quarterly report) analysing the performance of the UK retail, wholesale and motor trade sector. Volume sales, orders on suppliers, sales for the time of year and stocks are all covered and the quarterly survey also covers imports, selling prices, numbers employed, investment and business situation. Financial markets tend to concentrate on the CBI's annual sales growth measure as a leading indicator of the official retail sales report.

This survey is a leading indicator of consumer spending because retailer and wholesaler sales are directly influenced by consumer buying levels. The monthly update provides a vital update on volume of sales, orders and stocks. Like the industrial survey, it carries significant weight in the formulation of economic policy at the Bank of England and within government as a highly respected barometer of high street trade. It is considered to be an advance indicator of retail sales although it is not well correlated with the official data on a monthly basis.

Monthly and quarterly