Soaking July washes away High Street hope for shop sales | City & Business | Finance
The sixth wettest July on record dampened shop sales, data has revealed.
Takings grew just 1.5% last month, according to trade body the British Retail Consortium and KPMG.
That was down from a 2.3% increase a year ago and below the 3.5% average over the past three months.
Downpours deterred shoppers from venturing out and dented demand for summer clothes.
Paul Martin, UK head of retail at KPMG, said: “As the storm clouds came out, shoppers retreated.”
The sales number was also weak because inflation – driven by price rises as retailers claw back higher costs – has begun to ease.
Meanwhile, online non-food sales fell again – down 6.9% year-on-year – as the post Covid trend back to stores continued.
Helen Dickinson, chief executive of the British Retail Consortium, said: “While consumer confidence is generally improving, it remains below longer term levels.”
The wet weather also prompted spending on “insperiences” – indoor experiences – according to separate data from Barclays. Spending on takeaways rose 9.2% and on digital content and subscriptions by 9.9%. Overall card spending rose 4% last month, said the bank.
It also credited Taylor Swift with helping to fuel a near 16% surge in outlay on entertainment last month. It came after tour tickets for the Bad Blood star, along with The Foo Fighters, went on sale.
Esme Harwood, director at Barclays, said: “While July’s weather was a wash-out for clothing retailers, it was a ray of sunshine for takeaways and streaming services, which performed better than expected.”
Abbas Khan, an economist at Barclays, said the coming months were likely to see pressures on retailers from energy and some other costs ease. He added: “However, offsetting this, more households are set to experience higher mortgage costs as they refix onto higher rates,” he said.
“Accordingly, while we do not expect a consumer recession in the coming quarters, growth is likely to be meagre.”