Retail sales in the United Kingdom rose unexpectedly in July as warm weather and Olympics boosted sales of food and drinks, a report from the British Retail Consortium (BRC) revealed Tuesday.
Retail sales values rose 0.1 percent on a like-for-like basis annually in July. Economists had forecast a 0.2 percent drop. A year ago, sales recorded 0.6 percent increase. On a total basis, sales were up 2 percent.
BRC said that the warm weather in the final week of the month, combined with the start of the Olympics, helped support food and drink sales. But the sharp fall in food inflation has dampened top line growth.
The three-month average showed the growth of like-for-like non-food sales outpacing food sales for the first time since May 2010. This development was mainly influenced by strong growth in clothing and footwear and toiletries and cosmetics.
However, discretionary and big-ticket items continued to struggle and their sales growth were often promotion-driven.
"July was clearly not a golden month for retail," BRC Director General Stephen Robertson said. "Like-for-like sales were virtually flat compared with a year ago and total growth of two percent was still behind inflation as consumers, dealing with squeezed budgets, prioritised their spending on essentials."
Robertson noted that as only the opening couple of days of the Olympic Games are covered by these statistics, "we'll have to wait a while to assess the overall impact on retail sales."
According to a recent survey by market research group GfK NOP, British consumer confidence remained weak in July. However, consumers were more willing to spend on big-ticket items than in the previous month.
Another survey by the Confederation of British Industry (CBI) suggested that the retail sales growth would remain sluggish in August despite an expected boost from Olympics. The economy contracted 0.7 percent quarter-on-quarter in the second quarter, marking the steepest fall in the gross domestic product in more than three years.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.