Total sales increase by 0.3%, according to data compiled by the British Retail Consortium

This article is more than 1 year old

This article is more than 1 year old

British retailers have recorded the worst month for sales in July since records began, as consumers tighten their belts with Brexit approaching.

According to British Retail Consortium sales data compiled by the accountancy firm KPMG, total sales increased by 0.3% in July, compared with a rise of 1.6% in July last year.

With the British economy facing growing uncertainty, the industry lobby group said the rise was the weakest since its records began in 1995.

Helen Dickinson, the chief executive of the BRC, said low real-wage growth for UK households and Brexit had left consumer spending languishing. The average growth in sales over the past 12 months was 0.5%, the weakest expansion on record.

“Whereas last year’s glorious sunshine and World Cup finals led to strong consumer demand over the summer, this year has been weak in comparison,” she said.

Official sales figures gathered by the Office for National Statistics have proven to be stronger than retail industry surveys have indicated. The volume of goods bought in May increased by 1% on the month, beating City economists’ expectations of a fall in sales.

The BRC and KPMG said that June and July were the worst on record. A separate survey of retailers by the Confederation of British Industry also found sales fell in July, marking the worst period in eight years for the high street.

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Barclaycard, which processes nearly half of credit and debit card transactions in the UK as the largest credit card provider, said British families had also begun to rein in their spending on essential items.

It said that consumer spending rose by 1.7% on the year in July. However, sales of essential items – recorded by spending in supermarkets and on petrol – fell by 0.9%.

Esme Harwood, a director of Barclaycard, said: “Spending has remained relatively subdued over the past few months, with an underlying uncertainty about the wider economic and political landscape causing many to hold off making purchases on bigger ticket items.”