YEAR-on-year growth in Scottish retail sales value slowed sharply in July, the latest industry figures reveal.
The sharp slowdown was driven by a renewed year-on-year fall in the value of non-food sales, the more discretionary element of consumer spending.
The figures, published today by the Scottish Retail Consortium, show sales value north of the Border in July was up 1.1 per cent on the same month of last year.
Scottish retail sales value had risen at the sharpest year-on-year pace since early 2014 in June, exceeding the UK-wide rate of increase for the first time since summer 2013.
The 2.7% year-on-year growth in Scottish retail sales value in June was achieved as hot and sunny weather and World Cup football provided a fillip for a retail sector facing the effects of a squeeze on household incomes across the UK.
Data published yesterday by the Office for National Statistics showed average weekly earnings for employees in Great Britain in the April to June period were up just 0.1% on the second quarter of last year in real terms.
Prior to the recent period of modest real pay growth, a spike in UK inflation driven by sterling’s post-Brexit vote weakness had led to a renewed and protracted real-terms fall in employees’ earnings.
The value of Scottish food sales in July was up by 5.6% on the same month of last year, the SRC figures show. However, non-food sales value last month was down by 2.4% on July 2017.
Year-on-year growth in total Scottish retail sales value over the May to July period, at 2.2%, is the strongest seen in any three-month period since October 2013, the SRC notes.
SRC director David Lonsdale flagged the deceleration in sales growth last month, after a “stellar” June. But he noted the real-terms, year-on-year rise in sales value in July had been “credible”, with gin, ice, and electric fans selling well in the good weather.
He added: “Non-food sales were less impressive, falling back in line with the longer-term trend. That’s a little disappointing after a strong summer. Whilst it’s a little early to worry, this could be a warning light on the dashboard.”
Year-on-year growth in retail sales value in the UK as a whole also slowed between June and July, but much less sharply than in Scotland. The less-pronounced slowdown in year-on-year growth in retail sales value UK-wide, from 2.3% in June to 1.6% in July, meant it was back ahead of that in Scotland last month.
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