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Last month was an awful one for British retailers as they endured their worst July since records began.
Total sales increased by 0.3% in July, compared with a rise of 1.6% in July last year, according to British Retail Consortium data compiled by the accountancy firm KPMG.
The industry lobby group said the rise was the weakest since its records began in 1995. It blamed “the combination of slow real wage growth and Brexit uncertainty”.
The Guardian says the news comes “as consumers tighten their belts with Brexit approaching” but The Times points out that the figures for July last year were “flattered” by warm weather and the football World Cup, both of which encouraged consumers to spend more money.
The news is disturbing for Britain’s economic health, Reuters says, particularly because retail was “the one sector of the economy which has held up relatively well since June 2016’s vote to leave the European Union”.
The British Retail Consortium said that the record temperatures in July, which had followed a wet June, would have been expected to spur extra purchases on summer clothes and barbecue food.
Paul Martin, head of retail and KPMG said: “Shoppers are notably disengaged overall. The pressure continues to build between online and physical offerings, costs continue to rise and the demands of consumers continue to grow.”
In a separate study, Barclaycard reported a similar trend in its monthly consumer spending data, which showed 1.7% growth. The group said the proportion of consumers who said they still felt comfortable making big purchases had fallen to 54% from 60%.
“Underlying uncertainty about the wider economic and political landscape (is) causing many to hold off making purchases on bigger-ticket items,” Barclaycard director Esme Harwood said.
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