UK retail sales growth slowed to six-month low in May

UK retail sales grew at their slowest pace in six months in May, according to a joint report by the British Retail Consortium (BRC) and KPMG. Rising prices for goods and higher monthly bills squeezed household budgets, dampening consumer spending.

The data shows that UK retail sales increased just 1% year-on-year. This modest growth was driven mainly by higher demand for food (+3.6%), with a further boost from strong consumer spending during major sporting events and holiday weekends.

Excluding the food sector, UK retail sales fell by 1.1% year-on-year in May, reflecting consumers' cautious spending habits, according to Helen Dickinson, Chief Executive of the BRC.

Meanwhile, Barclays reports a 3% decline in UK households' confidence in their financial situation, dropping to 67%. Half of all consumers are actively cutting back on discretionary spending, clothing purchases being their first sacrifice.