Hardware and household goods among categories that reported the sharpest falls, as high prices and low salary increases mean consumers "feel the pinch" again.
The Confederation of British Industry's (CBI) latest Quarterly Distributive Trades Survey revealed that, although 30% of retailers said the volume of sales rose during the first two weeks in May, 48% reported a fall - giving a balance of -18%. The result was much weaker than expected by respondents and was the lowest balance since March 2009, said the CBI.

The major sub-sectors that saw the sharpest year-on-year decline included durable household goods and hardware, china and DIY. Clothing sales were also down after three months of continuous growth.

Retailers were also found to be negative about next month, with a balance of -15% indicating that another fall in volume is expected.

Employment in the retail sector continued to fall in May, compared with a year ago, while 5% of firms expect the overall business situation to deteriorate over the next three months -a sign, said the CBI, that conditions in the retail sector remain challenging.

The survey also showed that price inflation continued in an upward trend. 54% of retailers said average selling pries rose, with just 5% reporting a fall, giving a balance of +49%.

CBI chief economic adviser Ian McCafferty commented; "These retail sales figures for the early part of May are clearly disappointing, with many sectors failing to achieve higher sales than a year ago. Unseasonal poor weather at the start of the month is likely to have dented clothing sales, while some signs of slowing momentum in the housing market may help to account for the renewed weakness in sales of big-ticket items and other household goods."

He concluded: "It appears that shoppers are feeling the pinch again and are being cautious with their purchases, given the squeeze to real incomes from higher prices and only a modest rise in average pay."