Interest rate and bad weather blamed
UK retail like-for-like sales increased just 1.8 per cent in May, compared with a rise of 3.6 per cent the previous year. Total sales were up 4 per cent, hit by interest rate rises and the bad weather.

According to the British Retail Consortium's (BRC) monthly sales figures, May's growth was the weakest since the 0.5 per cent rise reported in November and below the average for 2006 as a whole. Consumer confidence also remained weak, demonstrated in the caution shown about making major purchases.

Clothing and footwear sales fell back sharply, as the weather worsened after a warm April. DIY and gardening also suffered from the cold and rain, while big-ticket purchases continued to disappoint. Smaller homewares, toiletries and cosmetics held up well, but food sales were down against last year.

BRC director-general Kevin Hawkins said: 'Although the weather was bound to depress sales growth, many of our members believe that the cumulative effects of the recent interest rate increases are now beginning to show up in these figures. The Bank of England should think twice before putting up rates again in the near future.'

KPMG head of retail Helen Dickinson said: 'All the clothing sectors reported negative like-for-like sales compared with last year - the poor weather over both bank holiday weekends really had an impact, particularly for children's clothing and footwear.

Overall, the results for May - and those for April - are below the trend of the first quarter of the year and represent the beginning of a lower growth phase, as the comparatives become tougher and the outlook less favourable.'

In the three months to May, like-for-like sales growth fell to 2.8 per cent and total sales growth stood at 5 per cent, compared with a like-for-like rise of 3.3 per cent in the three months to April and a sales increase of 5.5 per cent.