LONDON (Reuters) - Retail sales growth slowed to its weakest rate in eight months in July as exceptionally wet weather and higher borrowing costs kept people away from the shops, a survey showed on Tuesday.
The British Retail Consortium/KPMG retail sales monitor said like-for-like sales grew 1.2 percent last month compared with a year ago — half the monthly average for the second quarter.
“The combination of a tightening squeeze on consumer spending and heavy rainfall reduced sales growth to a level not seen since last November, despite heavy discounting and falling retail inflation,” said Kevin Hawkins, the lobby group’s director general.
Total sales, which include new floor space, were 3.1 percent higher last month than in July last year — also the slowest rate of growth since last November.
The Bank of England has raised interest rates five times in the last year to a 6-year high of 5.75 percent and many economists expect at least one more hike this year.
The BRC noted sales patterns had been heavily influenced by the weather, with July 2006 the hottest on record and July 2007 the wettest.
It said last month’s torrential rain had hit clothing and footwear but boosted department stores and out-of-town centres.