Retail sales volumes have fallen to a rate “not seen since the depths of the pandemic”, according to industry data showing the third consecutive monthly decline as inflation eats away at household spending power.
The British Retail Consortium (BRC) said the value of total sales was 1% lower in June than a year ago.
That followed a 1.1% decline in May.
Like-for-like sales, which adjusts for changes in floor space, fell 1.3%.
However, the figures are not adjusted for inflation which the BRC said was running at 3.1% among its members – the highest since 2008 as the cost of living crisis gathers pace.
The official consumer prices index measure of inflation facing consumers is at a 40-year high of 9.1% – led mostly by energy and fuel costs.
Separate data from Barclaycard on Tuesday showed consumer spending in June was 6.2% higher than a year earlier, pushed by a nearly 40% jump in spending on utilities.
The BRC noted a temporary lift in grocery spending during the Queen’s platinum jubilee Bank Holiday and some business for fashion retailers as the weather warmed up.
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Small firms facing ‘quite scary’ impact from rising costs
But it noted an increased trend of shoppers trading down to cheaper brands of food and other goods.
The body also pointed to a particular lack of demand for big purchases, such as household appliances and furniture.
BRC chief executive Helen Dickinson said: “Sales volumes are falling to a rate not seen since the depths of the pandemic, as inflation continues to bite and households cut back spending.”
She added: “Retailers are caught between significant rising costs in their supply chains and protecting their customers from price rises.
“The government needs to get creative and find ways to help relieve some of this cost pressure – the upcoming consultation on transitional relief is a golden opportunity to ensure that retailers aren’t overpaying on their business rates bills.
“Government action on transitional relief would make a meaningful difference to retailers’ costs and ease pressure on prices for customers.”