UK retail sales growth slowed to just 0.7 per cent in August as mounting household costs prompted consumers to rein in discretionary spending.
Total sales edged up 0.7 per cent year on year during the four weeks to 29 August, according to the latest BRC-KPMG Retail Sales Monitor, well below the 3.1 per cent increase recorded in the same month last year.
The performance also fell short of the 12-month average growth rate of 1.6%.
Food remained the main driver of growth, with sales rising 2.6 per cent compared with a 4.7 per cent increase in August 2025.
However, non-food sales fell 0.8 per cent year on year, reversing the 1.8 per cent growth recorded during the same period last year.
In-store non-food sales dropped 1.2 per cent, while online non-food sales slipped 0.2 per cent.
Despite the decline in digital sales, online penetration increased slightly to 36.4 per cent of non-food purchases, up from 36 per cent a year earlier.
British Retail Consortium lead economist Harvir Dhillon described August as a “disappointing month for retail sales”, as rising household bills continued to squeeze consumers.
He said shoppers were particularly cautious about discretionary and big-ticket purchases, with categories such as furniture and household appliances suffering, while consumers gravitated towards smaller treats including health and beauty products.
KPMG UK head of consumer, retail and leisure Linda Ellett said summer spending had begun earlier than usual this year as warm weather brought forward seasonal purchases.
Food, drink, health and beauty continued to benefit from the heat and holiday spending during August, but most other categories struggled to maintain their previous momentum.
Retailers are now turning their attention to back-to-school trading and preparations for the crucial final quarter, including Black Friday and Christmas.
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