Retailers failed to bask in the glow of Team GB's Olympic success last month as the sector suffered its worst sales this year, figures have shown.
Retail sales values were down by 0.4% on a like-for-like basis last month, said the British Retail Consortium (BRC). This was the lowest since November last year (excluding April, which was heavily distorted by Easter timings).
The sporting event gave a mild boost to food sales in the form of party food and drink but the net effect of the Games was minimal as lower footfall in London hit sales, it said.
Stephen Robertson, director general of the BRC, which represents some 60% of retailers, said: "It's clear people were absorbed by the magnificent Olympics and had little interest in shopping, especially for major items."
The research will fuel fears over Britain's economic recovery as the country struggles to emerge from the longest double-dip recession since the 1950s. The most notable impact from the Olympics was felt online, which saw growth of 4.8% in August, the lowest since the BRC started collecting data on internet sales in October 2008.
Warmer weather in the middle of August helped boost sales of food, especially party snacks such as crisps, nuts and barbecue foods. Clothing had an "unusual and rather disappointing" month, the BRC said, as womenswear retailers failed to attract customers to autumn/winter ranges.
Mr Robertson added: "As summer gives way to the all-important Christmas run-up, retailers will be hoping sales that didn't happen in August have been postponed and not lost entirely."
The CBI has already released a weak survey for August, which showed that the balance of retailers reporting that sales were up year-on-year was minus 3% in August, the weakest level since last April.
Howard Archer, chief UK and European economist at IHS Global Insight said, said: "Reinforcing belief that consumer spending is likely to be limited in the near term at least, consumer confidence remains mired near record low levels, amid elevated concerns over the economy.
"Indeed, even the 'feelgood factor' arising from the successful Olympic Games failed to lift consumer confidence in August, which is somewhat worrying."
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