| Consensus | Actual | Previous | |
|---|---|---|---|
| Sales Balance | -2% | -25% | -9% |
Highlights
The CBI's July distributive trades survey was much weaker than expected. At minus 25 percent, the headline sales balance was fully 23 percentage points short of the market median and down 16 percentage points versus its June mark. This was its third successive sub-zero print and its weakest reading since April 2022. With actual sales rising 0.5 percent on the month a year ago, today's data should imply a poor period for retailers.
Moreover, with orders placed with suppliers sliding to their lowest level since January 2021, the CBI expects no improvement in August - their forecast is down at minus 32 percent.
The July results trim the UK's ECDI to minus 14, signalling a modest degree of overall economic underperformance. However, at 3, the ECDI-P remains (just) in positive surprise territory indicating that in general the real economy is performing much as expected.
Moreover, with orders placed with suppliers sliding to their lowest level since January 2021, the CBI expects no improvement in August - their forecast is down at minus 32 percent.
The July results trim the UK's ECDI to minus 14, signalling a modest degree of overall economic underperformance. However, at 3, the ECDI-P remains (just) in positive surprise territory indicating that in general the real economy is performing much as expected.
Market Consensus Before Announcement
The headline sales balance is seen improving from minus 9 percent in June to minus 2 percent this month.
Definition
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.
Description
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.
