The Confederation of British Industry (CBI) reported on Tuesday its latest survey of retailers showed retail sales volume balance stood at -23 in the year to September, down sharply from 11 in September. That was the lowest reading since June.

Economist had forecast the reading to decrease to 1.

Retail sales volumes are expected to decline at a similar pace in November (-26).

The report also revealed that orders placed on suppliers dropped steeply (balance of -39, from -14) and are seen to decrease at an even faster rate in the year to November (-48). Meanwhile, stock levels in relation to expected sales were seen as broadly adequate, after easing to their lowest level since March (+6, from +11). Stock levels are expected to remain similar next month (+8).

“The fall in retail sales in October is a warning sign of a further loss of momentum in the economy as coronavirus cases pick up and restrictions are tightened across many parts of the country,” noted Ben Jones, CBI Principal Economist. “It’s no surprise that sales have dipped despite no new direct restrictions on retail in England, as the evidence from earlier in the year suggests consumers become more cautious as case numbers rise. With footfall still down by one third, many retailers face a difficult run-up to the all-important Christmas period. It is vital that local authorities use their discretion over the new Tier 2 grant funding to target support in a way that helps keep town and city centers open for business.”