June retail sales slump caused by upward blip in May, says BRC

Thursday, 24 July 2008
The record 3.9% drop in retail sales during June is largely the result of May’s unexpectedly high growth rate, the British Retail Consortium (BRC) said today.

It was reacting to the official retail sales figures released earlier by the Office for National Statistics (ONS), which also showed a 3.6% fall in food sales.

But these results showed conditions remain tough for customers and retailers, the BRC added.

The industry body said the record falls in June only served to confirm its earlier conclusion that the May sales figures were a summer blip caused by the long-awaited warm weather arriving at the start of the month.

Stephen Robertson, BRC director general, said: “The sharp monthly fall in sales volumes confirms May's, unexpectedly high, sales growth was a one-off triggered by summer sun finally arriving.

“The scale of the month-on-month fall in sales volumes is partly because it's a comparison with May's high growth but does show there are few signs yet of tough conditions improving.

“These figures show the total value of sales in June was up 3.4 per cent on a year ago. But that is a real-terms fall and conceals a tale of two sectors, with growth mainly driven by increases in some food prices rather than any new willingness to spend on non-essentials.

“The economic fundamentals remain weak with consumer confidence at all time lows and the housing market on a downward trend.

“But retailers are not taking this lying down. Competition is benefiting customers as retailers fight back with high-profile price cuts and promotions.”

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