Retail sales grow for second month running but hardware and DIY continue to decline, with the economy not expected to return to full strength until the end of 2011.
According to the CBI's latest Distributive Trades Survey, 39% of retailers said that sales volumes in early March were higher when compared with the same period last year. 26% said they were lower, resulting in a balance of 13% - broadly in line with expectations, explained the CBI.
The sales growth is expected to continue at a similar pace through Easter, with a balance of 14% of retailers predicting that sales in April would be higher than they were in 2009.
Durable household goods retailers reported very strong annual sales growth, while furniture and carpet retailers also performed well but at a slower pace than in February. However, hardware, china and DIY sales fell sharply again - though not as rapidly as last month.
Chairman of the CBI Distributive Trades Panel and ceo of Asda Andy Clarke said: "Despite not matching the strength seen in February, its encouraging that high street sales have continued to grow this month. The outlook for Easter may still be positive but, with a weak economy and pay freezes for many, consumers are likely to remain cautious for some time."
He added: "While grocers continue to outperform relative to other parts of the high street and sales of some big-ticket household goods are still growing strongly, hardware and DIY sales continue to struggle. Conditions will stay tough on the high street for some time, and shoppers will be holding their breath for the Budget."
The CBI expects recovery in the UK to remain sluggish during the course of the year and doesn't believe it will pick up much pace until the middle of 2011.
In its latest economic forecast, the organisation states that it expects growth prospects for the economy to remain fragile in the near-term now that certain stimulus measures, such as the VAT cut ad car scrappage scheme, are ending.
The CBI also believes that growth in consumer spending will stay subdued this year, as people save more and worries about job security persist. GDP is still not expected to have returned to pre-recession levels by the end of 2011.