Outlook At first sight, the evidence from the retail sector offered contradictory signals: a profits warning from Carpetright that contrasted with a second successive month of better sales data from the CBI.
Look beyond the CBI's headline data, however, and the picture the employers' organisation presents is one of faltering confidence. That's a message much more in tune with the Carpetright announcement, unfortunately.
Carpetright is regarded as a bellwether company – first into recession and first out. For now, the retailer is clinging to the hope that the dip it has seen in trading during the first few months of this year can be attributed to poor weather and – though this seems really desperate – uncertainty in the run-up to the election.
What's more likely, however, is that these straws in the wind are the first evidence of setbacks for the retail sector. A downturn in fortunes was always likely given the prevailing winds the sector faces – fears of unemployment, restricted access to credit, rising direct and indirect tax – and now it seems to be arriving.
Carpetright is unlikely to be the last retailer to issue a profits warning. And the CBI's headline data may not remain positive for much longer.Reuse content