Retail sales stumble as shoppers run out of summer steam

World Cup fever couldn’t save July’s high streets

Even scorching weather and World Cup fever couldn’t keep Britain’s tills ringing in July, with retail sales falling 0.5%. The figures aren’t disastrous – sales were still up across the latest three months – but they expose just how selective shoppers have become. Consumers chased June’s discounts and splashed out on drinks and World Cup gatherings, while clothing and household goods suffered. With inflation back at 2.9% and higher energy bills looming, small retailers now face an uncomfortable question: have we already seen peak spending for 2026, leaving Christmas to rescue the year?

RETAIL SALES SLIP IN JULY

Even world cup fever couldn’t save the high streets this summer. Retailers are being given a reality check: sales fell 0.5% in July, despite a month packed with World Cup excitement, scorching temperatures, and a booming drinks trade.

The drop followed a blooming June, when retailers pushed out promotions to cash in on the early heatwave. That may have boosted the June’s numbers but left July looking flat. The ONS confirmed there was clear “evidence of reduced promotions in July”, especially across household goods and clothing.

Hot weather + world cup

One sector kept the tills ringing: alcoholic drinks and beverages. Supermarkets reported strong demand driven by heatwave drinking, World Cup gatherings and targeted promotions

ONS analysts said drinks retailers “performed well”, with supermarkets also benefiting from warm‑weather demand for outdoor gear and fans.

Non-food sales

The biggest drag came from non‑food stores, where sales fell back sharply after June’s early discounting spree. Clothing & footwear were down 2.7%, the fastest fall in over a year. Household goods sales fell 1.9% and online/non‑store retail was down 3.6%

Retailers told the ONS that many customers had already snapped up bargains in June, leaving July quieter than usual.

Three‑month picture

Despite July’s wobble, the broader trend is more upbeat.

The ONS chief economist says retail sales increased across the latest three months, with all main sectors except motor fuel seeing growth. Retail volumes up 1.1% compared with the previous quarter; sports merchandise, fans, outdoor products, and clothing did well and weather‑driven boosts across supermarkets and non‑store retailers pushed up sales.

Consumer confidence rises

The figures land as UK consumer confidence hit a two‑year high, even with renewed tensions in Iran and higher energy bills squeezing household budgets.

Shoppers may be cautious, but they’re not retreating so far, and July’s dip looks more like a hangover from June’s promo surge than a sign of weakening demand.

THE TAKEAWAY

July’s retail slowdown may not signal a crisis as the three months figures look strong.  Retailers front‑loaded discounts into June, the World Cup boosted drinks not fashion, and hot weather helped supermarkets more than high‑street apparel. The underlying trend is that consumers are still spending selectively, seasonally, and promotion‑driven.

However, consumers, despite their slight rise in consumer confidence and a decline in savings showing consumers were willing to spend, only have so much money. Inflation is on the rise again, up to 2.9% for the 12 months to July, from 2.6% in June, so that may have a knock-on impact on the retail figures for August. Impending energy prices rises are likely not just to squeeze household budgets but to put the cap on spending for the rest of the year. Despite the optimism and confidence reports, its possible we have seen peak retail for this year, leaving the small and micro retailers in particular longing for a lucrative festive period.