UK retail sales fall in June despite World Cup and barbeque heatwave boost

The World Cup and the heatwave kept British shoppers away from the high street in June, despite encouraging stronger sales of food, drink and barbecues. Photograph: Bryn Lennon/Getty Images

The World Cup and the summer heatwave kept British shoppers away from the high street last month, despite encouraging stronger sales of food, drink and barbecues across the country.

Revealing a surprise fall in retail sales in June, the Office for National Statistics said clothing stores and other non-food retailers suffered from reduced footfall amid the hot weather and football celebrations.

The volume of goods sold across the whole of the retail industry dropped by 0.5% last month compared with May, missing City expectations for a rise of 0.2%. Sales at foods stores edged up 0.1% over the month.

The latest snapshot from the ONS will add further pressure on the Bank of England to delay an expected rise in interest rates next month after weaker readings for growth in workers’ pay and inflation, which unexpectedly stayed at a one-year low in June.

The surprise fall in retail sales triggered a sell-off of the pound, which fell against the dollar to a 10-month low of just below $1.30.

Although some of the decline in consumer spending had been anticipated after two strong months for retail sales in April and May when the royal wedding encouraged shoppers to spend, economists were surprised by the scale of retreat. Overall, sales in the second quarter of the year were the strongest since 2004, helped by the stronger spending in April and May.

Retailers have been coming under intense pressure over the course of the past year as hard-pressed consumers face weak wage growth as well as higher levels of inflation triggered by the Brexit vote. Major firms including House of Fraser, Marks & Spencer and Mothercare are closing hundreds of stores between them as a consequence.

An increasing shift towards online shopping has also damaged the high street. Sales online as a total of all retailing remained unchanged at 18% last month, while the ONS said internet shopping for clothing and footwear continued to achieve record new proportions of online retailing.

There were some early indications the hot weather had been having a damaging impact on the high street when the homeware retailers DFS Furniture and Dunelm warned of lower profits during the heatwave.

Kathleen Brooks of the financial spread better Capital Index said: “It turns out that when the weather is this good in the UK we don’t go shopping and we hit the beach instead.”