Clothing continued to boost overall UK retail sales in August

Clothing continued to boost overall UK retail sales in August

Clothing remained one of the largest contributors to overall UK retail sales growth in August, as it continued to report strong increases, albeit lower than the prior month.

Sales volumes at clothing retailers increased, with a balance of 61% reporting year-on-year growth, down from +78% last month, according to the CBI's latest quarterly Distributive Trades Survey.

But the footwear and leather sector saw a decline for the third consecutive month, with a balance of -70% reporting year-on-year decreases, accelerating from -29% in July.

Sales volumes for the retail sector as a whole increased, with 36% of retail respondents saying they were up on a year ago, and 15% saying they were down, giving a balance of +24%. This was up from last month, and above expectations for +13%.

Growth is expected to rise at an even faster pace in the year to September (+35%), CBI said.

Internet sales volumes grew strongly in the year to August (+39%), but were below the long-run average (+51%). They are expected to pick up pace slightly next month (+43%).

“Retail growth is continuing at a steady pace and it’s really encouraging to see firms’ investment intentions picking up alongside more jobs being created in the sector,” said Rain Newton-Smith, CBI director of economics. “Household spending seems to have remained firm going into the second half of this year, so the outlook for the retail sector looks upbeat.”

However, she warned that the renewed fall in average selling prices illustrates the “intense challenges” facing some retailers, where strong price competition to capture consumer value is still prevalent.