UK retail sales volumes fell 0.5% in July, reversing a strong June that had been driven by hot weather and early promotions, the Office for National Statistics reported. Non-food stores led the decline, but the three-month trend stayed positive and consumer confidence improved.
British retail sales volumes fell 0.5% in July, matching economists' forecasts, after a bumper June boosted by hot weather and early promotions. That initial 1% June gain was later revised down to 0.7%, according to ActionForex.
The retreat centered on non-food categories, where clothing, household goods and department stores each posted declines as earlier promotions pulled demand forward into June. The ONS said there was "evidence of reduced promotions in July" among household goods and clothing retailers. Department store sales also declined, with retailers citing stock availability issues.
Food and drink retailers offset some of the drop. Sales of alcoholic drinks performed well, which the ONS attributed to promotions, the hot weather and the World Cup.
Over the three months to July, sales volumes still rose 1.1% compared with the previous quarter. Annual growth slowed to 1.6%, missing forecasts of 2.2%. Overall volumes stayed at their second-highest level since April 2022, supporting the view that July was a pullback rather than a sharper downturn.
Online sales values fell 3.9% in July from June, after rising 2.5% the month before, with internet purchases slipping to 28.3% of total retail spending from 29.2%. Separately, the GfK Consumer Confidence Index rose to -14 from -17 last month, even as respondents flagged rising inflation and Middle East tensions as risks ahead.
Moody's Analytics economist Andrew Hunter said the fall reflects fading resilience in UK consumer spending and expects retail sales growth to slow over the second half of 2026 as rising inflation erodes real incomes.
Sources: Business | The Guardian, ActionForex, Economic Indicators News
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