SCOTTISH consumers carried on spending in June amid talk of a cost-of-living crisis with preparations for the summer holidays and discounting by retailers boosting sales.

The Scottish Retail Consortium said the bounce in spending seen in May continued in June, during which there was what it described as a solid increase in sales after taking account of the surge in inflation.

This has prompted the Bank of England to increase interest rates repeatedly in recent months leaving many people facing big increases in their mortgages.

The latest monitor compiled by Scottish Retail Consortium and accountancy giant KPMG found total sales increased by 11.3 per cent compared with June 2022. Adjusted for inflation, the year-on-year growth rate was 2.9%.

Scottish Retail Consortium director David Lonsdale noted the growth rate in Scotland outpaced the figure for the UK as a whole and was the best monthly real terms performance since Christmas.

READ MORE: Scottish food industry stalwart sees sales surge in ‘unprecedented’ year

Total retail sales increased by 4.9% across the UK, according to research by the British Retail Consortium and KPMG.

 Growth in Scotland was driven by increased spending on food and on clothing and footwear. Mr Lonsdale said the latter reflected a combination of aggressive discounting by retailers and Scots preparing for summer holidays.

Paul Martin, head of UK retail at KPMG, said sales of suntan lotion, food and clothing were all given a boost in June as Scots made the most of the record temperatures.

He said consumers appear to have remained resilient to the effect of the rise in inflation, noting: “Retail sales growth has remained steady at around 9% every month in the first half of this year.”

However, SRC and KPMG highlighted the fact that retailers are having to accept cuts in margins to encourage shoppers to loosen their purse strings.

“Retailers found consumers focused their spending on items in the sales, with there being little desire to spend more for in-season or full priced stock,” said Mr Lonsdale. “That continues the trend of shoppers keeping their discretionary spending laser-focused on what they need right now, which was corroborated by a weak month for larger or homeware purchases.”

READ MORE: Lanarkshire snowball maker highlights cost pressures faced by manufacturers

Mr Lonsdale noted that conditions could worsen given the prospect that there may be further tax rises at a national and local level to plug gaps in public finances.

“It’s easy to see how the current summer light could darken into an Autumn gloom,” he cautioned.

Total Food sales increased by 15.8% in Scotland in June compared with the same month in 2022. The growth rate was in line with the three-month average. It was above the 12-month average growth rate of 12.2%. 

Total Non-Food sales increased by 7.5% in June compared with June 2022. This was above the three and 12-month averages, of 6.1% and 5.4% respectively.

Growth in retail sales in Scotland has been stronger than in the UK as a whole in each of the last 12 months.