British retail sales grew at a slower pace than expected in June as poor weather and higher interest rates took their toll, a survey showed today.
The Confederation of British Industry said its distributive trades survey's reported sales balance fell to +17 this month - its lowest since November - from +31 in May.
That was below retailers' own forecast for a balance of +23 and analysts' forecast for a balance of +25 and interest rate futures popped higher as investors bet that the figures at the margin will reduce the need for aggressive interest rate rises.
Most analysts expect the Bank of England to raise interest rates next month and markets are currently pricing in further increases beyond that.
But the CBI said consumers were already suffering after four interest rate hikes in less than a year.
"This survey shows consumers are reining in their spending in response to higher borrowing costs," said John Longworth, head of the survey's panel. Nevertheless, retailers are predicting a small pick-up in sales growth for July with the expectations balance at +19.