Retail sales growth slows as price hikes in supermarkets continue to prop up figures

Helen Cahill
Follow Helen
Source: Getty

Retail sales growth slowed in July, but grocery sales continued on an upward trend due to inflation.

Overall sales for the industry edged up 0.9 per cent year-on-year, according to figures from the British Retail Consortium (BRC), down from a growth of 1.1 per cent in the year before.

Read more: Food price inflation cools as grocers protect shoppers from rising prices

Food sales increased 2.3 per cent on a like-for-like basis, a rise partly fuelled by supermarkets putting up prices. Non-food retailers were hit by a sales drop of 0.7 per cent.

High street stores continued to suffer at the hands of the rise in online shopping. Like-for-like sales in shops fell three per cent.

Helen Dickinson, BRC's chief executive, said the grocers would continue to boost retail sales, but that this would be "driven more by price than volume". Non-food retailers would continue to struggle, she said.

Paul Martin, UK head of retail at KPMG, said an increase in food spending was driven by mounting household debt.

"Interestingly, July retail sales diverge from the latest consumer confidence figures, which noted a downturn in consumer sentiment," he said.

"This suggests that UK shopping patterns remain mixed, although with demand continuing to be weak, retailers would be wise to remain cautious."

Read more: Retailers blame cost squeeze for job cuts