Retailers enjoy 0.6% sales rise
Retail sales improved for a third month running in July, according to new figures, but high street conditions remain difficult, with few shop owners optimistic.
Sales by value were 0.6% higher on a like-for-like basis compared with a year ago and follow declines of 0.6% in June and 2.1% in May, the British Retail Consortium (BRC) said.
The BRC, the UK's largest retailers' association, said much of the improvement was due to extended clearance sales, especially in clothes and in footwear.
There was also a revival in food sales after a poor previous month, but online and mail order sales growth slowed to a near two-year low after a clearance uplift the previous month faded.
On a total sales basis, July improved by 2.5% on a year ago and by one percentage point over 1.5% growth seen in June.
BRC director general Stephen Robertson said: "This is a modest improvement on recent months but conditions remain very difficult for retailers.
"When you take into consideration inflation and January's increase in VAT, 2.5% growth effectively means people are buying fewer goods."
Shoppers have been hit by a combination of soaring costs and muted wage growth, with the result many have been seeking out promotions and discounted items.
Howard Archer, chief European economist at IHS Global Insight, said: "It is highly likely that once clearance sales are over, or the best of the bargains are gone, consumers will quickly put their hands back in their pockets."
As more evidence of consumer frugality, the BRC said the revival in food included cheaper options, such as slow-cooked meat and home baking.