UK retailers continue to face a prolonged slump, with June marking the ninth consecutive month of falling sales, according to the latest CBI survey. The downturn deepened sharply, with a weighted balance of minus 46 percent, and forecasts for July look even more severe (minus 49 percent). Retailers are not only grappling with falling demand but also judging sales volumes to be well below seasonal norms, intensifying concerns across the sector.

Caution among consumers remains the key drag, reflected in slashed supplier orders, the steepest drop since December 2023 (minus 51 percent), and rising stock levels (26 percent) as unsold goods pile up. Motor trades and wholesalers are also caught in the drag, showing continued contraction, though at slightly moderated rates.

Interestingly, the only flicker of resilience comes from online retail, where sales inched up by 6 percent year-over-year, though this marks a considerable slowdown from May's 37 percent growth.

With the broader distribution sector under sustained pressure, calls for an inclusive industrial strategy are timely. While initiatives around skills and deregulation are welcome, businesses will hope that these efforts extend beyond high-growth sectors to genuinely revive local commerce and national retail confidence.

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.