Shoppers are spending more on luxuries like jewellery says head of CBI retail survey

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Jewellery and watches were named among the best performing categories in the latest Confederation of British Industry’s (CBI) retail sales report.

Retail sales for the second quarter are expected to have risen by almost 1% despite signs growth slowed slightly through June.

The rolling CBI retail report, which measures the percentage of companies reporting growth against companies reporting falling sales.

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The balance fell from +51 in May to +29 in June, dragged down mainly by the grocery sector.

Howard Archer, the chief UK and European economist at IHS Global Insight, said: “This is still a very decent survey that points to healthy consumer activity.”

Consumer spending looks like the engine of growth across the wider economy if it transpires that retail sales grew 0.9% compared to overall GDP growth of below 0.4%.

“The prospects for retail sales and consumer spending look bright, especially now that earnings growth seems to be firming appreciably, thereby boosting purchasing power along with negligible inflation and increased employment,” said Archer.

Barry Williams, chairman of the CBI survey, said retailers should look forward to a bright summer.

“Summer is a time of optimism for retailers and this year is no different. Even though growth slowed slightly this month, retailers are not letting that subdue their hopes for the season.

“Low inflation – expected to stay below 1% throughout this year – has given customers more discretionary income. The power of the pound in their pocket is going further and shoppers are spending more on treats, like flowers and jewellery, as well as on activities with their families.”

Tags : CBIEconomyJewelleryRetail Survery
Rob Corder

The author Rob Corder

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