Good morning. Today we're talking about dampened retail sales, Royal Mail dispute resolution, CBI crisis and house price stagnation.
Rainy retail sales
UK retail sales fell 1.0% between February and March, more than the 0.6% decline expected as consumers cut back after two months of resilience. Non-food stores sales volumes fell 1.3%, following a rise of 2.4% in February, with retailers blaming the bad weather - the rainiest March in 40 years - for fewer shoppers. The drop in retail sales came despite of a big improvement in GfK’s latest consumer confidence index which jumped for the third month in a row showing households are more upbeat about the economy’s prospects and more willing to make big-ticket purchases. That could give chancellor Jeremy Hunt hope that the UK can continue to dodge a recession.
Royal Mail said workers will get a 10% salary increase over several years as part of a final deal the which ends a year-long pay dispute. The company and the Communication Workers Union, which represents about 115,000 postal workers, said they had reached a resolution following several strikes last year including in the run-up to Christmas. The dispute centred on changes that Royal Mail wants to make to working practices, as the 507-year-old group faces competition from nimbler rivals who have grown rapidly while employing delivery drivers on less favourable terms.
CBI fallout continues
Several companies cancelled or suspended their CBI memberships on Friday as the lobby group fights for survival following a second rape claim. NatWest, BT, Aviva, ITV and Unilever were among the big names to take action. Last week the CBI sacked its director general Tony Danker after allegations of inappropriate behaviour which built on a slew of historic and serious misconduct claims. Founded in 1965 the CBI is the UK’s main business lobbying group, representing around 190,000 firms across a variety of sectors. According its most recently published accounts, £22m of its £25m income in 2021 came from membership fees. In recent weeks several organisations have postponed engagements with the CBI, including the government, in what has been the biggest crisis in its history.
House prices weakens
UK property owners are turning more cautious about asking for higher prices, according to Rightmove. Average asking prices rose 1.7% from a year ago in April to £366,247, the slowest pace since December 2019 before the pandemic and government tax breaks triggered a frenzy of buying. The monthly pace of increase slowed to 0.2% from 0.8% in March. The figures point to a slowly stagnating market where a shortage of new properties for sale is keeping prices aloft despite a jump in mortgage rates and double-digit inflation.
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