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GB: CBI Distributive Trades
| Actual | Previous | |
| Sales Balance | -17% | -44% |
Highlights
UK retail activity remained in contraction in the year to January, although the pace of decline eased notably compared with December. Retail sales volumes fell at a much slower rate, at minus 17, offering tentative signs of stabilisation after a weak end to 2025. However, this improvement appears fragile, with retailers expecting the downturn to re-intensify in February as consumer demand remains subdued.
Spending conditions continued to reflect low household confidence and cautious purchasing behaviour. Although sales were still judged poor for the time of year, sentiment improved slightly from December. Online retail recorded a sharp deterioration, with sales falling at their fastest pace since mid-2024, though a moderate rebound is anticipated next month.
Weaknesses extended across the wider distribution sector. Wholesale volumes declined sharply and are expected to remain under pressure, while total distribution sales continued to contract at a firm pace. Motor trades also experienced falling volumes, reinforcing the breadth of demand softness.
Retailers responded by scaling back orders, albeit less aggressively than in December, while stock levels moved closer to historical norms. Looking ahead, cost pressures remain a key concern. With margins already compressed by falling volumes, rising wage costs risk further constraining profitability and delaying a meaningful recovery in consumer-facing sectors.
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.