LONDON, (Reuters) - British retail sales growth slowed in August at the fastest pace in more than a year as the squeeze on consumers from rising prices continued, according to a survey on Thursday.
The Confederation of British Industry’s (CBI) monthly retail sales balance slid to -10 in August from +22 last month, its lowest since July 2016 - just after Britons voted to leave the European Union.
The reading was far below even the lowest forecast in a Reuters poll of economists, all of whom expected only a modest slowdown in growth.
While retailers expected sales to pick up again next month, they were downbeat about the current business situation.
Quarterly figures from the CBI showed retailers reduced staff at the fastest pace since 2009 and they did not expect an improvement soon.
“Despite the warmer weather at the start of the month, retail sales have cooled as higher inflation continues to squeeze consumers’ pockets,” CBI economist Anna Leach said.
The Brexit vote in June 2016 led to a big fall in the value of sterling, which has pushed up inflation, gnawing at consumers’ disposable income this year.
Official data earlier on Thursday showed British household spending grew at its weakest pace since late 2014 during the second quarter, underlining the strain on households and retailers.
Reporting by Andy Bruce, editing by David Milliken