Forexpros – Retail sale volumes in the U.K. increased significantly in May and sentiment regarding the business situation for the next quarter improved, industry data showed on Tuesday.
In a report, the Confederation of British Industry said the result of its index of U.K. retailers improved by 27.0 points to a reading of 21.0 in May from minus 6.0 in April.
Analysts had expected the index to deteriorate by 1.0 point to a reading of minus 7.0 in May.
On the index, a reading above 0.0 indicates higher sales volume, below indicates lower.
Sentiment regarding the business situation for the next three months has also turned positive for the first time since November 2011.
Despite the increase in sales volumes, retailers reported that sales were below average for the time of the year.
Looking ahead, retailers expect sales volumes to grow again on a year ago basis in June and the business situation to be stable over the next three months, following expectations of a modest deterioration in recent quarters.
Commenting on the report, Chair of the CBI Distributive Trades Panel Judith McKenna said, “The combination of high unemployment, slow wage growth and weak consumer confidence means that the retail sector is likely to remain under pressure in the short term.”
Following the release of the data, the pound was flat against the U.S. dollar, with GBP/USD trading at 1.5681.
Meanwhile, European stock markets remained mixed. London’s FTSE 100 dipped 0.2%, the EURO STOXX 50 shed 0.25%, France’s CAC 40 was flat, while Germany’s DAX edged 0.3% higher.
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