By Joe Parkinson
Of DOW JONES NEWSWIRES
LONDON (Dow Jones)--U.K. retail sales experienced their largest year-on-year fall for three years in April, with sales of clothing and footwear the weakest for eight years, the British Retail Consortium said Tuesday.
Same-store retail sales were down 1.5% on April 2007, the largest drop since spring 2005, and the second consecutive monthly decline.
"This is the first time in three years we've had two months in a row of year-on-year falls in like-for-like sales," said Stephen Robertson, Director General of the BRC.
Total sales, which include new retail outlets, rose 1.0% on the year, compared with a 1.1% fall in March.
By official measures, retail sales have beaten expectations this year, and shown little indication that the credit squeeze has had an impact on spending habits. According to the Office for National Statistics, sales were up 4.6% on the year in March.
However, with house prices falling and both the government and the Bank of England predicting a significant slowing of the economy this year, consumer confidence has plummeted.
In April, GfK NOP's headline measure stood at lowest level since November 1992.
The BRC survey is another indication that weakening confidence and the reduced availability of credit is having an impact on consumers.
If confirmed by other surveys and the official statistics, the BRC survey makes it more likely that the BOE will cut its key interest rate again soon. The central bank's Monetary Policy Committee last week held the Bank rate at 5.0%, having previously cut three times since December.
April may have been an abnormally poor month for retail sales, given that the Easter holiday period - which by tradition sees heavy spending on materials for home and garden improvements - came in March.
The BRC said that, although the early Easter could have distorted the monthly data, "underlying conditions remained tough."
"Another disappointing month for the nation's retailers - two consecutive months of like-for-like sales declines," said Helen Dickinson, Head of Retail at financial services firm KPMG.
"All sectors, with the exception of food, homewares and toiletries, were in negative like-for-like territory for the month," she said.