The volume of retail sales was up 1.8 per cent for the three months to July, compared with a 2 per cent increase in the three months to the end of June and a 0.4 per cent rise for the same period last year.
The monthly sales volume fell 0.3 per cent from June to July - the first drop since January.
Food and drink retailers experienced sales growth increases, but generally non-food sectors posted declines, particularly household goods stores. The average value of weekly sales was£4.8 billion in July, 3.4 per cent higher than July last year.
Ernst & Young director of retail Tim Sleep said: 'Looking ahead, the retail climate remains tough amid shaky consumer confidence. Consumers may be just able to swallow the recent 0.25 per cent interest rate rise, but an additional increase could be on the cards. Add in the prospect of much increased energy bills facing both retailers and consumers and the renewed terrorist threat and it is clear that the retail sector outlook is far from rosy.'
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