FX.co ★ UK Retail Sales Growth Misses Forecasts in July

In July 2025, retail sales in the UK experienced a 1.8% increase on a like-for-like basis compared to the previous year. This marks a slowdown from the 2.7% growth observed in June and falls below the anticipated rise of 2.1%. Food sales witnessed a 3.9% upsurge, largely driven by warm weather and an active sporting calendar. However, this increase in spending was primarily due to food inflation rather than an actual rise in demand. Sales in the non-food sector grew by 1.4%, with the fashion segment performing well at the beginning of the month before slowing down due to deteriorating weather conditions. Meanwhile, homeware and indoor furniture maintained steady growth. Helen Dickinson, the Chief Executive of the British Retail Consortium, expressed concern: “With sales growth at these levels, retailers are struggling to cover the £7 billion in additional costs introduced in the last Budget. If further taxes are imposed in the upcoming Autumn Budget, many retailers will face difficult decisions regarding store operations and employment, which could in turn lead to increased prices.”