Hmm. It's now raining over much of the UK and the World Cup is diverting people's attentions from more important things such as buying bikes.
The CBI's Quarterly Distributive Trades Survey shows annual retail sales growth reverting to the trend reported since January, suggesting that a slowdown in the growth of spending is starting to take effect.
Compared with a year earlier, 49 per cent of firms said sales were up while 24 per cent said they were down. The plus 25 per cent balance compares to plus 57 per cent in April, which was the highest individual monthly balance since August 1988. Growth expectations for June remain consistent with the past three surveys, indicating a reasonably robust rate of expansion but not a return to boom conditions.
Stock levels built-up in May as sales volumes fell below expectations. The build-up of stocks led to a fall in orders placed on suppliers. [Remember, this is for all retail sectors but the model applies quite well to current conditions in the bike trade].
Pressure on retailers' prices intensified in the face of fierce competition and weakening demand. [Yep, we know all about that sort of thing, too!]
Prices rose at the slowest rate for 15 months and are expected to slow further in the year to June.
Despite the slowdown in growth and the pressure on prices, mainstream retailers remain optimistic that the general business situation will improve over the next six months. Employment grew at the fastest annual rate for two years and, for June the number of retail jobs is expected to remain well above the levels of a year ago.
Alastair Eperon, Chairman of the DTS Panel and a director of Boots, said: "All the evidence in today's survey points to a gradual slowdown in consumer spending. With prices rising at the slowest rate for fifteen months, inflationary pressures are diminishing. There is no necessity for the Bank of England to increase interest rates tomorrow."
Strong annual growth was reported by newsagents and confectioners, and stores selling durable household goods, books, stationery and groceries. Those reporting slower annual growth included, footwear and leather stores and those selling hardware, china and DIY goods. There was no news on how bike shops were faring.
However, motor traders' sales volumes continued to grow strongly year-on-year in May, but the rate of expansion slipped from the record high reported in April. A significant slowdown in the annual rate of growth is expected in June, but this should be seen in the context of very strong growth over the year to June 2001, said a statement from the CBI.