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BRC/KPMG - Strongest growth in retail sales for 18 months in June

UK retail sales increased by 1.8% on a like-for-like basis in June compared to the same month last year. On a total basis sales were up 2.9%.

The figures published by the British Retail Consortium and KPMG in their monthly shop price index show that the growth was the strongest since January 2014, excluding Easter distortions, and compared with a 12-month average of 1.6%.

The BRC said total food sales grew in June for the seventh month in a row, excluding Easter distortions. In June, salads, berries, picnic and barbecue food were up as expected but there was also demand for some colder weather products like soups and roast meat.

Total non-food sales grew by 2.6% over the three months to June, close to their 12-month average growth of 3.1%.

Toys and baby equipment was the best performing category, helped by outdoor toys, particularly in the last week of the month, when the heat wave stimulated the sales of seasonal items.

Fashion categories were helped by several retailers going into summer sale earlier than last year.

Helen Dickinson, director general of the British Retail Consortium, said: “The retail industry performed strongly last month, experiencing the best overall sales growth in eighteen months, excluding Easter distortions, albeit on the back of a weak June last year.”

Dickinson added: “We saw welcome signs of growing consumer confidence, with people more willing to ‘trade-up’ and spend a bit more on big-ticket purchases, likely boosted by the growth in the supply of credit and other factors such as low inflation and rising real incomes.

“Some of the measures outlined by the Chancellor in last week’s budget are likely to help boost consumer confidence even further, with measures like the continued freeze in fuel duty and the increased personal tax allowance ensuring consumers have more money in their pockets to spend.”

Meanwhile, online sales of non-food products grew 17.6% in June versus a year earlier, when they had grown by 10.6%. The non-food online penetration rate was 18.4%, up from 16.9% in June 2014.

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