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UK Retail Sales Growth Slows Sharply In October: CBI

UK retailers reported a sharp slowdown in sales growth during October after a strong September, survey figures from the Confederation of British Industry showed Thursday.

The retail sales growth balance of the CBI's Distributive Trades survey tumbled to +19 from +49 in September. Economists had forecast a balance of +35, while retailers had forecast an improvement to +51 percent.

Looking ahead, retailers expect sales volumes to grow at a slightly stronger pace of +24 during November.

"Low inflation and improving wages mean the prospects for sales growth are decent, but challenges remain, like the weakening global economy and competitive pressures in the retail sector, so we can't take this positive outlook for granted," CBI Director of Economics Rain Newton-Smith said.

Sales grew in most sub-sectors while orders placed with suppliers grew less-than-expected. The growth in orders to suppliers are expected to ease further next month.

IHS Global Insight economist Howard Archer said consumers may have taken a little bit of a breather in October to gear up for Christmas after splashing out in September.

"The prospects for retail sales and consumer spending look largely bright for the fourth quarter given households' current very healthy purchasing power," the economist added.

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