Scottish shoppers threw the brakes on spending in July as miserable economic news and dismal weather triggered a slump in retail sales.

Today's latest industry monitor produced by the Scottish Retail Consortium (SRC) and accountancy giant KPMG found that total sales across the country were 4.6% higher compared to July 2022, with the increase driven by surging inflation rather than higher volumes of goods sold.

Adjusted for inflation, there was a year-on-year decline of 3%. This compared to an equivalent growth figure of 2.9% in June, which itself followed a bounce in spending in May.

Ewan MacDonald Russell, deputy head of the SRC, said summer food ranges were ignored as customers opted for warming traditional foods over seasonal specials. Meanwhile, hopes for splurges on summer clothing were washed out by "unseasonable weather" that forced fashion retailers into the early discounting of these lines, further eroding profit margins.

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“With the wider economy stumbling under the dual burden of high inflation and rising interest rates, this may not be the last month of disappointing sales in the near future," Mr Russell said.

"With that in mind politicians need to be realistic on what policy measures they bring forward in the coming months, as it’s certain any further costs will be passed onto hard pressed consumers. It’s quite likely a difficult few months are ahead for Scotland’s already hard-pressed retail industry.”

Before taking inflation into account, total food sales on a like-for-like basis were 9.1% higher compared to July 2022, when they had increased by 5.3%. This was below the three-month average increase of 13.9% and 12-month average growth of 12.5%.

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Total non-food sales increased by 0.9% in July compared with July 2022, when they had increased by 3.7%. This was below the three-month average increase of 5.2% and the 12-month average of 5.1%.

"Total sales growth eked out a modest 4.6% increase in July, set against a backdrop of 10% inflation," said Paul Martin, UK head of retail at KPMG.

He added: "Despite their resilience during the cost-of-living crisis, Scottish consumers may face challenges in sustaining spending due to persistent high inflation and rapidly rising interest rates throughout the rest of the year. Both consumers and retailers are finding that they are having to get used to doing more with less as conditions remain incredibly challenging.”