Higher mortgage interest rates and other pressures on household incomes affected UK retail sales growth which registered the weakest since November 2006 as it rose 1% year on year in October, according to the British Retail Consortium (BRC).
Director general Kevin Hawkins of BRC said this was due to the effect of “higher mortgage interest rates and other pressures” on household incomes.
But food and drink sale grew, aided by Halloween, religious festivals and Rugby World Cup sales opportunities.
Meanwhile, the three-month growth rate fell to 2.0% from 2.1% in September.
The total sales, which includes growth in retail floor space, were up 3% on the year, and 3.9% across the three-month period.
Experts warned that recent credit market worries and high interest rates could lead to the consumers continuing to tighten their purse strings.
“It points to some challenging trading conditions for many retailers in the run-up to Christmas, which are likely to persist until interest rates are reduced and consumer confidence begins to improve,” said Mr Hawkins.
The BRC report said that by cutting Christmas food prices early retailers were already fighting to provide value for money.
The mild weather also hit clothing and footwear sales in October.
Furniture and homeware sales slowed but health and beauty items “held up well”.
Consumers were more and more cautious about making major households purchases, the BRC said.
The report comes a week after business body, the CBI, said growth in sales was continuing to slow as retailers started to feel the pinch.
