London, United Kingdom. British retailers reported lower sales in May amid weak demand, although the decline was less severe than the record downturn seen a month earlier, according to figures released by the Confederation of British Industry.
Sales balance improved from April low
The CBI’s monthly retail sales balance rose to -46 in May from -68 in April, which had been the series’ lowest reading since it began in 1983. The balance measures the difference between the percentages of firms reporting rises and falls in sales volumes compared with the same month a year earlier.
June expectations and seasonal sales
Expected sales for June improved to -36 from -60 expected for May. Sales for the time of year fell to -35 from -32 in April, the weakest level since June 2025.
Retailers remain cautious
“With sentiment among retailers negative for two years now, businesses expect to cut back further on investment, while continuing to reduce headcount,” CBI economic surveys manager Charlotte Dendy said.
Last week, official retail sales data for April, which covers a wider range of stores than the CBI measure, showed sales volumes excluding fuel were 1.1% higher than a year earlier and unchanged from the month before.
Concerns over costs and demand
Businesses are concerned that a surge in energy prices caused by the Iran war will reduce households’ disposable income and raise their own costs. Britain’s longest running consumer sentiment survey, from GfK, fell to its lowest since October 2023 in April and rose only slightly in May.
The CBI said retailers raised prices this month by the least since February 2025, which it attributed to weak demand. The Bank of England is monitoring how businesses’ prices and profit margins develop as it considers whether interest rates may need to rise later this year to help limit the inflation shock from the Iran war.
