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Retailers are still reporting a fall in high street sales for June – although not as bad as feared, a survey has revealed.

Of all the retail respondents to the Confederation of British Industry's (CBI) latest distributive trades survey, 39 per cent reported that in the first half of June sales were lower than a year ago, while 30 per cent said sales had increased.

The balance of -9 per cent represents a decline but not as sharp as had been feared, due to a huge rise in food sales.
Clothing retailers reported a survey record low in their year-on-year sales growth, and booksellers and stationers also fared poorly.

Retailers tied to the housing market, such as durable household goods, furniture and carpets, hardware, china and DIY continued to report falling annual sales.

However, grocers, including supermarkets, had another month of strong year-on-year sales growth, with a balance of +67 per cent reporting an increase in sales, which was the highest since December 2005 (+70 per cent).

Andy Clarke, the new chairman of the CBI's distributive trades panel, and retail director of Asda, said: "High fuel prices and concerns about the economy have blunted consumer appetites, and those retailers linked to the housing market are continuing to endure difficult conditions.

"Grocers have had another strong month, and we are seeing people spend more in supermarkets as they focus on the essentials and also upgrade to higher value food ranges instead of having a night out."

The monthly CBI survey is released ahead of the official Office for National Statistics (ONS) figures, and provides another indication of the strength of the high street.

Analyst Vicky Redwood from Capital Economics warned the figures point to hard times ahead for retailers: "Even after June's modest improvement, the weakness of the CBI's distributive trades survey is still massively at odds with the strength of the official sales data.

"The rise in the reported sales balance from -14 to -9 left it pointing to annual growth of the official sales measure of just two per cent or so – compared to the 8.2 per cent rate seen in May.

"The CBI survey, as always, needs to be read with care, especially given that it only covers half of the month. But given the pressures on consumer finances, we still suspect that it's giving the more accurate picture of the state of high street demand. We expect the official measure of sales to drop sharply in June."