UK retail sales have suffered their steepest decline since records began, as the ongoing conflict in Iran has heightened inflation concerns among households. A recent survey from the Confederation of British Industry (CBI) revealed that the retail sales volume measure fell to -68 in April, down from -52 in March, marking the lowest reading since the series started in 1983.
Retail sales: Consumer Confidence Takes a Hit
The survey, conducted between March 26 and April 14, found that a staggering 77 per cent of retailers reported a year-on-year drop in sales, while only 9 per cent noted an increase. This significant decline reflects the broader economic strain as consumer confidence falters.
Predictions for the Coming Months
Looking ahead, expectations for May have also dimmed, with forecasts dropping to -60 from -49, the most pessimistic outlook since the early stages of the COVID-19 pandemic in March 2021. According to CBI economist Martin Sartorius, the economic impact of the Iran conflict is becoming increasingly clear, and he urged the government to address rising costs that are affecting both households and businesses.
Calls for Government Action
Sartorius emphasised that alleviating cost-of-living pressures will depend on tackling the escalating costs of doing business. The CBI has called on the government to halt new employee rights legislation that could further increase costs for employers, as well as to consider reducing property taxes and lowering electricity bills.
Wider Economic Context
The CBI’s findings come in the wake of recent military actions, including the U.S. and Israel’s strikes on Iran starting February 28, which led to the closure of the Strait of Hormuz, a critical route for oil exports. As a result, many businesses are feeling the impact of fluctuating energy prices and supply chain disruptions.
Consumer Sentiment at Record Lows
Adding to the gloomy picture, Britain’s longest-running consumer confidence survey conducted by GfK has also dropped to its lowest level since October 2023. Coupled with a similar CBI survey of manufacturers that indicated the lowest optimism levels since the pandemic began, it suggests a worrying trend for the UK economy.
Retailers’ Experiences
While the decline in the CBI figure was marked, another measure asking retailers to rate sales as good, bad, or normal also saw a downturn, albeit less severe. This measure fell to -32 in April from -23 in March, hitting its lowest since June 2025. Retailers are clearly feeling the pressure as they navigate this challenging landscape.
